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Trailbreaker Resources Ltd. — Management Reports 2026
Apr 13, 2026
44099_rns_2026-04-13_8cb22b74-36d1-49e9-91e4-85aec465e81e.pdf
Management Reports
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TRAILBREAKER RESOURCES LTD.
MANAGEMENT'S DISCUSSION AND ANALYSIS
For the year ended December 31, 2025
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
General
This Management's Discussion and Analysis ("MD&A") of Trailbreaker Resources Ltd. ("Trailbreaker", or the "Company") for the year ended December 31, 2025 has been prepared by management as at April 13, 2026 and should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2025 and the notes thereto, which have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board. All dollar amounts included in this MD&A are stated in Canadian dollars unless otherwise indicated. Readers are encouraged to read the Company's public information filings on SEDAR+ website, www.sedarplus.ca.
Cautionary Note Regarding Forward-Looking Statements
In this MD&A, forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those implied by the forward-looking statements, which speak only as of the date the statements were made, and readers are advised to consider such forward-looking statements in light of risks as set forth in the following discussions.
1. Company Overview
Trailbreaker is a British Columbia corporation located in Vancouver, BC. It is a publicly traded company listed on both the TSX Venture Exchange ("Exchange") under the symbol "TBK" and the Frankfurt Stock Exchange under the symbol "KCG". Trailbreaker's primary focus is mineral exploration.
1.1 Mineral Exploration
Prior to June 2011, the Company owned and operated several types of industrial commercial businesses. In June of 2011, the Company completed a change of business and became a mineral exploration company under the new name, Goldstrike Resources Ltd. and proceeded to acquire options on twenty-four mineral properties totaling 3,782 claims covering over 79,000 hectares in Yukon Territory, Canada.
Over the next several years, the Company continued to add mineral claims through staking and entering into option agreements with claim holders. Properties that have not demonstrated a likelihood for economic success were dropped and written off.
The Plateau developed into the Company's flagship property. In March 2017, the Company formed a strategic alliance with Newmont Canada FN Holdings ULC ("Newmont"), a subsidiary of Newmont Mining Corporation, to explore and develop the Plateau property. The alliance was terminated in January 2019 while the Company continued to work the property on its own.
On August 10, 2018, the Company completed a plan of arrangement (the "Arrangement") and spun-off its exploration and evaluation assets comprising the "White Gold District Properties" into a newly formed public company named Luckystrike Resources Ltd ("Luckystrike"). Luckystrike changed its name to Golden Sky Minerals Corp ("Golden Sky") in February 2020.
On January 17, 2020, the Company consolidated its issued and outstanding common shares on a 20-old-for-1-new share basis.
On March 22, 2021, the Company changed its name to Trailbreaker Resources Ltd, representing the Company's changing focus to developing an evolved brand of district-scale discoveries in safe jurisdictions. The Atsutla Gold project, acquired through grassroots staking, evolved into the Company's new flagship property with the discovery of widespread, high-grade gold in 2021. As of April 7, 2026, the Company holds seven mineral properties in British Columbia and two properties in Yukon Territory which the Company is actively working on.
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
1.2 Petroleum and Natural Gas
In November 2015, the Company entered into an agreement (the "POP Agreement") to acquire all issued and outstanding shares of Petro One Energy Corp. ("Petro One"), an Exchange listed company. The result of the acquisition, which completed during March 2016, allowed the Company to access $1,250,000 in cash held by Petro One to advance the Company's mineral projects. Most of Petro One's oil and gas assets have been maintained since that time, but production has been suspended due to the reduced production and historical low world prices for oil and gas until recently.
Since 2021, the Company has been focusing on reclaiming and divesting Petro One's oil and gas assets in order to free its resources to focus fully on its mineral exploration business.
2. Mineral Properties
2.1 Atsutla Gold Project
The Atsutla Gold project represents a brand-new, high-grade gold discovery in British Columbia where greenfield exploration has returned rock samples assaying up to 18.38 oz/ton (630 g/t) gold and 55.25 oz/ton (1,894 g/t) silver in an area with no previously known gold mineralization. The project consists of 27 mineral tenures covering over 30,000 hectares of underexplored, highly prospective ground in northwestern British Columbia. All but one claim (132 ha) are 100%-owned by Trailbreaker Resources with no underlying royalties or payments.
The project covers a portion of the Atsutla mountain range within the Kawdy Plateau of northwestern BC; 70 km south of the BC-Yukon border and 120 km northwest of Dease Lake, BC. Although placer gold was recorded in multiple drainages in the area during the early 1900s, very little mineral exploration has occurred since then. The area was briefly explored for copper, tungsten, and molybdenum during the 1970s with gold mineralization completely overlooked.
The Atsutla Gold project is centred over the crustal-scale Teslin – Thibert fault system that marks the division between the Quesnel and Cache Creek tectonic terranes. Gold mineralization on the property is closely related to the Mesozoic intrusive batholiths that comprise the Atsutla mountain range. The geological setting suggests strong potential for multiple styles of gold mineralization including Cu-Au porphyry, epithermal, orogenic vein and intrusion-related.
To date, Trailbreaker has defined 5 significant gold zones over 26 kilometers: Highlands, Christmas Creek, Snook, Willie Jack and Swan.
- The Highlands zone is comprised of widespread high-grade gold and silver veins with coarse visible gold over a 750m x 600m area with assays up to 630 g/t (18.38 oz/ton) Au and 1,894 g/t (55.25 oz/ton) Ag.
- The Christmas Creek zone is located 2 km east of the Highlands zone and consists of high-grade mineralization with assays up to 102 g/t Au & 524 g/t Ag.
- The Snook zone is located 3.5 km northeast of the Highlands zone and displays multiple generations and styles of mineralized veins. Rock samples have returned assays up to 53.3 g/t Au.
- The Willie Jack zone consists of a 1.25-kilometer-long gold-in-soil anomaly, with soil sample assay values up to 3.77 g/t Au and rock grab samples up to 9.9 g/t Au.
- The Swan zone is centered on a ~1.5 x 1.5 km multi-element soil anomaly (Au-As-Ag-Cu-Mo-Sb-Bi), with soil sample assay values up to 406 ppb Au and grab samples up to 11.7 g/t Au, 212 g/t Ag, and 0.81% Cu. The Swan zone anomaly is directly adjacent to a historic molybdenum-copper porphyry prospect that was not explored or analyzed for gold.
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
2.2 Liberty Property
On January 22, 2024, Trialbreaker announced the acquisition of the Liberty property located in central British Columbia. The 5,054 hectare Liberty property is an early-stage copper-molybdenum (Cu-Mo) porphyry target located in the Cariboo Mining district, approximately 60 km northwest of Quesnel, BC. The property is road accessible by an extensive network of well-maintained Forest Service Roads.
The Liberty property is located along the western edge of the Cache Creek terrane, which hosts numerous Cu-Mo porphyry deposits, such as Taseko's Gibraltar Mine, which is the second largest open-pit copper mine in Canada. The Gibraltar Mine contains 6.4 billion pounds of copper from past production and current reserves. The current reserve has an average copper grade of 0.24% and a cut-off grade of 0.15% Cu.
The primary focus at the Liberty property is a Mesozoic Cu-Mo porphyry target, defined by coincident Cu, Mo, gold (Au), and silver (Ag) mobile metal ion (MMI) soil and induced polarization (IP) chargeability anomalies located on the margin of a poly-phase granitic stock. Historic drilling in the 1960s by Rio Tinto, to the south of the modern coincident IP and geochemical anomaly, returned an assay result of 123.1 m of 0.11% Cu and 0.04% MoS₂, from the top of bedrock to the end of hole.
In addition to the porphyry target, the Liberty property also hosts Cu-skarn and Au-Ag epithermal targets, which are often genetically related to porphyry deposits.
During the summer of 2024, Trailbreaker completed an inaugural 2,442m diamond drill program on the property, consisting of seven drill holes. All drill holes intersected Cu and Mo mineralization. Highlights from the program include:
- LIB24-003 intersected:
- 34.2 m of 0.47% Copper Equivalent* (CuEq) from 385.0 m;
- Including 14.7 m of 0.94% CuEq from 404.5 m;
-
Including 5.9 m of 2.02% CuEq from 410.2 m.
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LIB24-001 intersected:
- 13.5 m of 0.33% CuEq from 257.5 m;
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And 6.6 m of 0.67% CuEq from 300.9 m.
-
LIB24-004 intersected:
- 6.0 m of 0.45% CuEq from 431.0 m;
- and 2.3 m of 0.36% CuEq from 500.0 m.
This first-pass drilling has confirmed that porphyry and related skarn mineralization is widespread at Liberty. The use of induced-polarization (IP) chargeability features proved to be a useful exploration tool for targeting at Liberty. Mineralization remains open to the southeast, north, and at depth. Copper grades increase toward the southeast, as shown near the end of hole LIB24-004. This mineralization is south of the historic IP survey area and the mobile metal ion (MMI) soil anomaly, and represents a large, underexplored portion of the property requiring additional exploration to vector toward a potential higher-grade core of the system.
The location and number of drill pads used in the 2024 program were restricted by an existing permit covering a small portion of the property. Based on these results, a new permit application is being prepared to conduct work beyond the current permit area, where mineralization is open.
Soil sampling in 2024 defined a property-scale (~10 km in length and up to 1.8 km wide) arc shaped, copper-in-soil anomaly. Prospecting near the southwestern extent of the soil anomaly resulted in rock samples assaying up to 15.62% Cu (float grab sample) and 23.71% Cu (subcrop grab sample). A continuous chip sample near these rock samples assayed 2.15% Cu over 3.0 m.
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
Subsequent to completion of the surface program, additional claims totalling 1,841 hectors were staked to the southwest to cover the open-ended soil anomaly and the strike extent of the high-grade copper mineralization. Results from this surface program are being utilized in the preparation and design of a new area-based permit application for Liberty, which will allow for advanced exploration beyond the limited area drilled in the spring.
IP and ZTEM surveys were completed in the fall of 2024. The ZTEM survey was designed to provide property-wide resistivity and magnetic data up to a depth of 1,500 m. The IP survey was conducted over the Cu-in-soil anomaly in order to define the extensions of historic chargeability and resistivity features that are coincident with Cu-Mo mineralization intersected during Trailbreaker's drill program.
The combined ZTEM and IP data interpretation define a central 1,600 m x 800 m area, extending to >700 m of depth, having a strong (>20 mV/V) chargeability response. The strong chargeability zone is within a larger area of moderate (>7 mV/V) chargeability, measuring 4.0 km x 3.5 km, extending to >700 m of depth. This IP chargeability anomaly is coincident with a resistive intrusive complex transecting the property from north to south, as defined by the ZTEM survey.
The strong chargeability anomaly has not been drill-tested. However, previous diamond drilling by Trailbreaker along the margin of the moderate chargeability anomaly returned long continuous intervals of Cu-Mo porphyry-style mineralization, including 213.7 m of 0.16% CuEq in hole LIB24-001.
ZTEM resistivity and magnetic data define two additional porphyry targets, based on mottled magnetic signatures including a central magnetic high, within the resistive intrusive complex. All three porphyry targets occur 'up-ice' of glacially transported Cu-Mo-Ag-Au multi-element geochemical soil anomalies defined from 2024 soil sampling.
2.3 Coho Property
On May 26, 2025, Trailbreaker announced the acquisition of the Coho property in central British Columbia. The 8,000-hectare Coho property is located 90 km north of the Town of Fort St. James, BC. The property has excellent road access via Forest Service Roads throughout the claims. The property is also located 30 km west of Centerra Gold's Mount Milligan Cu-Au porphyry deposit, a producing mine with current reserves of 1.2 B lbs Cu and 2.8 Moz Au. The property was acquired through an option agreement in which Trailbreaker has the option to acquire a 100% interest in the property.
Exploration at the Coho property dates back to the 1960s and includes property-wide soil geochemical surveys, geophysical surveys, and 2,186 meters of diamond drilling in 20 widely spaced holes. Several kilometer-scale geochemical anomalies have been defined, and narrow, high-grade copper-gold values were intersected in historic diamond drill holes. Recent exploration efforts have outlined several new copper-gold porphyry targets that remain to be drill tested. These include the Chent West, Coho West, Brooks, and Coho zones.
Trailbreaker's Coho property is contiguous with the Chuchi Project which is currently being advanced by a joint venture between Centerra Gold and Pacific Ridge Exploration. The Chuchi Project has undergone a considerable amount of exploration since its discovery in the 1960s, by companies such as Noranda, BP, and AuRico, and with over 11,000 meters of diamond drilling completed in 53 drill holes. The majority of this drilling has focused on the BP zone which represents a 1.5 km x 1.5 km area of copper-gold mineralization with a historic, non-NI 43-101 compliant resource of 50 million tonnes grading between 0.21 - 0.40% Cu and 0.21 - 0.44 g/t Au. Significant drill intersections include: 16 m of 1.55% CuEq within 100 meters of 0.51% CuEq (1991 drill campaign), and 382 meters of 0.27% CuEq (2024 drill campaign). The BP zone sits on the north-south Valley/Redline fault structure that trends south into Trailbreaker's Coho property.
Trailbreaker's Coho property covers a similar geological and mineralogical setting to the BP zone (3 km to the north) and the Mount Milligan Cu-Au porphyry deposit (30 km to the southeast). Situated within the prolific Quesnel tectonic terrane, the Coho property is underlain by Lower Jurassic volcanic and sedimentary rocks of the Takla Group intruded by Jurassic monzodiorite and syenite porphyry intrusions associated with the margin of the Hogem batholith.
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
The Coho property is an alkalic Cu-Au porphyry target. This type of mineralized system commonly forms in clusters which have strong potential for significant gold content. Examples of such deposits along the Quesnel terrane include: Mount Milligan, Mount Polley (measured and indicated resource of 1.25 B lbs Cu, 1.9 Moz Au), Kemess (measured and indicated resource of 1.7 B lbs Cu, 4.4 Moz Au), Red Chris (reserves of 8.1 Moz Au, 4.8 B lbs Cu), and Amarc's new AuRORA discovery in the JOY district (recent drill results include 0.98 g/t Au, 0.25% Cu over 271 m).
The Coho zone is the priority target, defined by a 650 x 550 m Cu-Au-Ag surface rock and soil geochemical anomaly hosted in diorite and spatially associated with an ENE-trending fault zone (the Coho fault) and gabbro dykes. Two additional faults, the Valley and Redline, extend south from the BP zone (Chuchi Project) and converge with the Coho fault at the Coho zone.
A total of 135 rock grab samples taken at the Coho zone from 2020 to 2022 returned the following values:
- Up to 16.15 g/t Au, with an average of 0.79 g/t Ag (median 0.04 g/t)
- Up to 16.35% Cu, with an average of 1.00% Cu (median 0.31%)
- Up to 67.3 g/t Ag, with an average of 7.7 g/t Ag (median 2.2 g/t)
A recent (2022) airborne ZTEM survey followed by a 2023 ground-based IP survey identified an interpreted 400 m x 250 m x 200 m deep porphyry intrusive complex (3D ZTEM anomaly) with a two-limbed IP chargeability high anomaly that spans more than 1.4 km. The chargeability limbs may represent phyllic alteration that commonly surrounds a potassic-altered porphyry core. The eastern limb underlies both the surface geochemical anomaly and 3D ZTEM intrusive complex identified at the Coho zone and is interpreted to represent an eastward tilted porphyry copper-gold system similar to the nearby Mount Milligan deposit.
The Coho zone is located 4.5 km south of the BP deposit and is currently interpreted to be situated along the same Valley/Redline fault structure that hosts the BP deposit. Alkalic porphyry deposits commonly occur in clusters and Trailbreaker's team believes the Coho property, in particular the Coho zone, may represent a similar Cu-Au porphyry deposit to the BP deposit, and that this system is part of a cluster of deposits found along the margin of the Hogem batholith. The high Au grades returned from surface sampling at the Coho zone also represent the potential of a higher-grade porphyry gold system, similar to the Mount Milligan deposit (average mine grade of 0.39 g/t Au). The Coho zone has never been drilled and remains the top priority drill target.
2.4 Wheaton Gold Property
On July 7, 2024 Trailbreaker announced the acquisition of the Wheaton Gold property, an orogenic gold prospect located 60 km east of the Village of Dease Lake, BC. The property covers the headwaters of multiple placer gold-bearing creeks, including Alice Shea Creek, source of the famous 52 troy oz 'Turnagain nugget'. The property was acquired through an option agreement in which Trailbreaker has the option to acquire a 100% interest in the property.
Highlights of the Wheaton Gold Property:
- 2,223 hectares in size, covering roughly 2 km x 9 km.
- Located 60 km east of Dease Lake, BC, with extensive truck and ATV trail access throughout the claims, servicing historic and current placer mining operations.
- Covers the headwaters of the placer gold-bearing Wheaton and Alice Shea creeks, which are famous as the source of some of BC's coarsest gold nuggets. This includes the fourth largest nugget ever found in BC, the 'Turnagain nugget', weighing 52 oz gold.
- The project represents one of BC's most underexplored placer gold districts, with very limited hardrock exploration work done to date.
- A three-hole, 304.7-meter diamond drill program completed in 1986 yielded numerous gold intercepts, including 5.38 g/t Au over 3.05 m (from 28.96 m depth).
- Historic gold-in-soil values up to 32.3 g/t Au, and historic rock grab samples up to 11.25 g/t Au, have been returned.
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
2.5 Plateau Property
Trailbreaker Resources' Plateau property is a district-scale gold system in the Selwyn Basin, 120 km east of Mayo, Yukon Territory. It is comprised of 2,805 contiguous quartz claims, covering 586 square kilometers.
Plateau's gold mineralization occurs across 50 km of strike within extensive sequences of quartz stockwork and hydrothermal breccias. Host rocks are Lake Proterozoic sedimentary rocks of the Yusezyu Formation (580 Ma) that have been metamorphosed to greenschist faces and deformed by northeast-directed folding and thrust faulting. Two granitic stocks of mid-Cretaceous age have intruded the Proterozoic rocks along the property's southern boundary.
Since the discovery in 2010, the property had seen relatively little exploration. From 2012 to 2017 Trailbreaker drilled 68 diamond drill holes totaling 7026 meters. Newmont Mining optioned the property from 2017 to 2019. Under Newmont, an additional 26 holes were drilled in 2018 totaling 7752 meters. Newmont also performed a property-wide airborne electromagnetic survey (SkyTEM), airborne magnetic survey, LiDAR survey, and a proprietary regional stream sediment survey (BLEG).
Significant drill results include 13.25 g/t Au over 17.5m at the Goldstack Zone and 7.6 g/t Au over 9.03m at the Gold Dome Zone (18km away).
On December 31, 2020, the Company decided to write down the carrying value of Plateau to $2.14 million. The claims remain in good standing to at least 2030.
2.6 McMurdo Property
The McMurdo property covers 1727.62 hectares (1 claim) and is 100%-owned by Trailbreaker Resources with no underlying royalties or payments. McMurdo is a regional grassroots exploration target, generated in-house by Trailbreaker's exploration team. The property is situated in southeastern British Columbia within the Spillimacheen Mountain Range, 30 km southwest of Golden, BC.
The property has a rich history of discovery and small-scale mining spanning from the 1890s through to the early 1900s. Mining was focused on high-grade gold veins and strata-bound polymetallic Pb-Zn-Ag replacement type mineralization. Though several prospectors and geologists have examined the numerous historical gold showings on the property over the decades, this is the first time modern exploration methods have been employed to identify the gold potential of the McMurdo area.
The property overlies Precambrian marine sediments of the Horsethief Group within a regional scale anticlinorium that is deformed by faults and folds and intruded by the Cretaceous Battle Range suite. The property was explored for shale-hosted lead-zinc SEDEX deposits in the early 1980s with significant prospecting, mapping and geochemical sampling programs. Gold mineralization was vastly overlooked during this time frame and most of the geochemical samples were not assayed for gold.
In the summer of 2020, Trailbreaker Resources conducted a limited first pass program of prospecting and geochemical surveying at the McMurdo property to confirm the presence and grades of historic gold-bearing quartz-sulphide veins and to evaluate the vein density for a potential bulk tonnage model. The program was successful in both extending historical gold showings and confirming high-grade gold mineralization in quartz veins. This includes in-situ and float rock samples that assayed up to 175.9 g/t (5.13 oz/t) Au from its newly expanded "Crown Point" zone. A total of 33 soil samples and 74 rock grab samples were collected during the program.
The Crown Point zone comprises a 400m x 300m area that contains auriferous quartz veins hosted in a micaceous grit unit. This area has been exposed following roughly 700m of glacial retreat since the turn of the 20th century, which provided company geologists with the opportunity to significantly expand the known historic mineralized zone. The quartz veins range from a few centimeters to 3m in width and contain irregularly disseminated pyritic mineralization throughout. The confirmed high-grade gold values in quartz veins highlights the potential for significant precious metal mineralization in the area.
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
2.7 Eakin Creek Property
In March, 2022, the Company announced the acquisition of the Eakin Creek property via staking and the amalgamation of historical claims and showings. The Eakin Creek property is located 100 kilometers north of Kamloops, BC and can be accessed via Highway 24 and by well-maintained forest service roads. The property covers 1,610 ha of prospective ground that drains into placer gold-bearing Eakin Creek. Eakin Creek lies in an underexplored portion of the Quesnel tectonic terrane that hosts many of BC's producing copper and gold mines, such as New Afton, Ajax, Mt Polley, Highland Valley, and Copper Mountain. The claim package is 100%-owned by Trailbreaker Resources with no underlying royalties or payments.
A regional-scale till sampling survey conducted by the Geological Survey of Canada has shown that this underexplored portion of the Quesnel terrane has an anomalous Cu-Au-As-Mo geochemical signature that is indicative of copper porphyry environments elsewhere in BC. Furthermore, some of BC's highest gold grain-count values are recorded from till samples from the Eakin Creek property.
Placer gold was first discovered in Eakin Creek in the late 1800s with small scale placer mining occurring through to the 1940s. The hard rock source of the placer gold was never found and remained a mystery for over 100 years. Gold in bedrock was first discovered on the property in 1983 during the construction of Highway 24, with subsequent hard rock discoveries continuing through to the early 1990s.
The property hosts a strong, widespread gold-in-soil anomaly with 58 historical samples containing greater than 100 ppb Au, to a maximum of 2,600 ppb (2.6 g/t). Prospecting and trenching have proved difficult in the area due to widespread glacial till cover, however the limited prospecting and trenching completed to date have been successful in determining the causes of gold-in-soil anomalies. Numerous high-grade float rock grab samples have been obtained from surficial pits, assaying up to 2.60 oz/ton (89.13 g/t) Au and locally containing visible gold. Limited outcrop sampling to date has returned a 3.0 m chip sample interval grading 3.15 g/t Au, within a 14.0 m interval grading 0.9 g/t Au. Gold is associated with fracture-controlled quartz-calcite veins and breccias, hosted by a Jurassic altered diorite.
In 2022, Trailbreaker completed a 302-sample Mobile Metal Ion (MMI) soil survey, a 10.75 line-kilometre IP survey, and reconnaissance prospecting. The MMI survey defined a 1,000 x 600 metre Au-Ag-Cu-Sb (gold-silver-copper-antimony) anomaly that is open to the south. This anomaly is coincident with resistivity and chargeability anomalies defined by the IP survey, which is strongest at 50 to 100m of depth.
Prospecting identified gold-bearing mineralization hosted by two main lithologies, with the majority of mineralized samples occurring within the geochemical and geophysical anomalies. Grab samples from bedrock returned assay values up to 8.2 g/t Au and 130 g/t Ag from separate outcrops more than 1 km apart.
In the spring of 2023, Trailbreaker completed a diamond drill program at the Eakin Creek property. The drill program consisted of 2,039 meters in eleven diamond drill holes. Drilling commenced on May 24th, 2023 and was completed by June 20th, 2023. The drill holes covered 750 meters of strike length and 800 meters across strike. Drilling returned gold-bearing intervals in all eleven drillholes, and successfully identified a bedrock source of the surface geochemical anomalies. Highlights of the drill intersections include:
- EC-23-02: 1.0 m of 14.3 g/t Au from 67.0 m
- EC-23-01: 3.0 m of 2.42 g/t Au from 145.0 m, including 1.0 m of 4.94 g/t Au from 147.0 m
- EC-23-05: 15.7 m of 0.32 g/t Au from 38.3 m, including 2.0 m of 1.50 g/t Au from 52.0 m
Additional drilling is recommended in order to expand the known zones of mineralization.
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TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
2.8 Castle Rock Property
The Castle Rock property is an early-stage copper-gold porphyry prospect situated on northern Vancouver Island, British Columbia. Covering of 3,108 hectares or prospective land, the claims are located approximately 70 km northwest of Campbell River, BC. The property is easily accessible via active Forest Service Roads that branch off of Highway 19. Trailbreaker owns half of the claims with no underlying payments or royalties, while the other half was optioned from Cazador Resources Ltd.
Northern Vancouver Island is host to several large Cu-Au porphyry deposits including Northisle’s Hushamu deposit that contains an Inferred Resource of over 5.57 Moz AuEq and BHP Billiton’s past producing Island Copper deposit that produced >2.7 B lb Cu and >1.0 Moz Au. The Merry Widow gold camp is situated 75 km to the northwest and the Zebellos gold camp is located 40 km to the west.
Castle Rock represents a relatively new gold discovery within a part of Vancouver Island that has seen limited exploration to date and was not previously known for its gold potential. The steep, rugged terrain of the Schoen Creek drainage has kept this area underexplored. The area was first opened to logging activity in the early 2000s. The new logging road networks allowed for a property-scale geochemical silt survey in 2012 which led to the discovery of a large gossanous outcrop (coined the Heart zone) with a chip sample returning 2.0 g/t Au over a 30 meter interval. The gold is hosted in Jurassic age granodiorite dykes that have intruded along a regional-scale fault zone separating Lower to Middle Triassic age sediments from the Upper Triassic Karmutsen basalts. The auriferous intrusive displays strong hydrothermal alteration and brecciation with gold mineralization associated with disseminated and veined pyrite.
Trailbreaker Resources completed a 3-day project evaluation program in 2022, focusing attention on the Heart zone. The program included a detailed soil sample survey consisting of 116 samples as well as 32 meters of channel sampling designed to confirm the historic grades and thickness. The program successfully confirmed historic gold grades, with 2022 values up to 0.680 g/t Au over 13.11m, including a subinterval of 1.85 g/t Au over 2.92m. Soil sampling successfully outlined a 400m x 50m anomaly associated with the Heart zone with samples up to 5.44 g/t Au.
During 2023, Trailbreaker completed a program consisting of the collection of 497 soil samples, 50 prospecting grab samples, and geological mapping. Highlights from the surficial exploration program include:
- Definition of a 3 km gold-in-soil geochemical anomaly along a magnetic lineament, including the newly defined Kokummi and Watchtower zones;
- Rock samples assaying up to 42.1 g/t Au and 1.93% Cu at the Flan zone, confirming historic results;
- Extension of the Heart zone in outcrop, with rock sample results up to 2.21 g/t Au (175 m north of the Heart showing) and 2.18 g/t Au (80 m east of it);
- Moss-mat sampling indicates gold mineralization may occur in drainages where no previous exploration has occurred;
- Interpretation of magnetic lineaments suggests that mineralization is associated with northwest trending structures splaying off the Kokummi granodioritic stock in the southwest property area. This indicates much of the unexplored property areas may have elevated mineral potential.
On August 12, 2024, the Company announced the results of their 2024 surficial exploration program. A total of 339 soil and 72 rock samples were collected across the property. Surface sampling at the Watchtower zone has outlined a continuous gold-in-soil anomaly covering a 350 m by 200 m area. The zone trends northwest-southeast along a more extensive 3 km long gold-in-soil trend. Rock sampling from this zone returned assay values up to 2.19 g/t Au, 0.54% Cu, and 6.2 g/t Ag from an outcrop with a ‘wormy’ quartz vein stockwork. The ‘wormy’ vein texture indicates a ductile deformational environment, with emplacement of quartz veining under high-temperature conditions, potentially in proximity to an intrusive body.
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TRAILBREAKER RESOURCES LTD.
Management’s Discussion and Analysis
For the year ended December 31, 2025 and 2024
Infill soil sampling at the Kokummi zone, southeast of the Heart zone, indicates continuity of the Au-in-soil trend over an 850 m strike extent with a 250 m width. The Kokummi zone occurs along a north-northwest striking fault near its contact with the Kokummi stock. ‘Wormy’ quartz veining with potassic alteration selvages occur in this zone, together with anomalous Cu values from rock sampling, indicating that a potential buried intrusion may be the source of the Au-in-soil anomaly.
First-pass prospecting was conducted at the Moakwa zone, on the eastern side of Castle Rock property, where elevated Au values from moss-mat sampling were returned in 2023. Numerous rock samples were taken over an 800 m strike extent, returning anomalous Cu assays up to 0.282%. Anomalous copper-in-rock values at the Moakwa zone indicate potential for further mineralization at the Castle Rock property.
2.9 Sheldon Property
On July 31, 2023, Trailbreaker announced the addition of the 919-hectare Sheldon property, located in central Yukon, as part of its robust property portfolio.
The Sheldon property covers a “Reduced Intrusion Related Gold System” (RIRGS), located within the Tombstone Gold Belt of the Selwyn Basin. The Tombstone Belt is host to gold (Au)-bearing prospects and deposits including: Snowline Gold’s Valley discovery, Kinross Gold’s Fort Knox mine (10 million ounces of gold, including past production) and Victoria Gold’s Eagle mine (4.3 million ounces of gold).
The property is located along the North Canol Road approximately 110 km northeast of the town of Ross River, YT. The property has excellent infrastructure with road access within 800 m of the property boundary.
Highlights of the Sheldon Property include:
- Located within the geologically fertile and highly prospective Tombstone Gold Belt of the mining-friendly Yukon Territory;
- Road accessible via the North Canol Road, approximately 110 km northeast of Ross River;
- Historic rock samples assayed up to 17 g/t Au;
- Reduced-Intrusion Related Gold System (RIRGS) style mineralization evident on the property, with many characteristic RIRGS geological features;
- Underexplored, with a number of strong geochemical and geophysical targets identified;
- 100% owned by Trailbreaker Resources, with no underlying payments or royalties.
3. Petroleum and Natural Gas
Petroleum and natural gas exploration
The Company’s petroleum and natural gas assets consisted of a number of oil and gas wells located in Saskatchewan and Manitoba that were acquired as a result of the acquisition of Petro One.
Certain of these petroleum and natural gas assets were subject to a joint venture agreement between the Company and Petro One. On completion of the acquisition of Petro One, the joint venture agreement was terminated. During the year ended December 31, 2022 and year ended December 31, 2021, the Company wrote off the carrying value of all the well equipment to $nil.
During the year ended December 31, 2021, the Company sold 4 of the wells for $1. As part of the transaction, the Company also waived the right to the $169,200 security deposit held by the Government of Saskatchewan under the Licensee Liability Rating Program. The Company also discharged the decommissioning related to these wells in the amount of $439,063. As result the Company recognized a gain of $269,863.
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
The Company has been focusing on its mineral exploration business and has decided to transition out from the petroleum and natural gas industry. Efforts have been made since 2020 to reclaim all the oil well sites. Two well sites in Saskatchewan are currently remaining to be fully reclaimed. The estimated decommissioning liability as of December 31, 2025 was $20,119.
4. 2025-2026 Exploration Activities
4.1 Coho Property
On January 19, 2026, Trailbreaker announced the receipt of a property-wide exploration permit for its 8,000-hectare Coho property, located in central British Columbia. The Coho property is a drill-ready copper-gold porphyry target situated 30 km west of the Mount Milligan mine.
A 5-year Multi-Year Area-Based (MYAB) Mines Act permit has been approved by the BC Ministry of Mining and Critical Minerals with a provisional expiry date of December 18th, 2030.
Approved Exploration Activities
- Diamond drilling, based from up to 50 drill pads
- Construction/modification of exploration access trails (up to 15 km)
- 20 line-km of ground geophysical surveys
- Construction of a temporary work camp
Community Engagement
The Coho property is located within the territory of the Takla First Nation, with whom Trailbreaker is committed to continued engagement and to building a working relationship. The Company is currently collaborating with the Takla First Nation on the future drill program.
About the Coho Property
The 8,000-hectare Coho property is located 90 km north of the Town of Fort St. James, BC. The claims were acquired by Trailbreaker through an option agreement signed in May, 2025 whereby Trailbreaker has the option to acquire a 100% interest. The priority target is the Coho zone, a drill-ready Cu-Au porphyry target with recently completed property-wide geochemical and geophysical surveys. The zone hosts a recently identified chargeability and resistivity anomaly, associated with high-grade gold and copper values from surface rock grab samples. While there has been limited historical drilling on the claims, the Coho zone, has never been drilled.
Located within the Quesnel Tectonic Terrane, the Coho property is situated in a district known for prolific alkalic Cu-Au porphyry deposits and discoveries. The property is located 30 km west of Centerra Gold's Mount Milligan Cu-Au porphyry deposit, a producing mine with current reserves of 1.2 B lbs Cu and 2.8 Moz Au. Pacific Empire Minerals' ('PEMC') Trident property is contiguous with the Coho property's western border. On December 15th, 2025, PEMC reported a drill intercept of 0.77% Cu, 0.51 g/t Au, and 3.4 g/t silver (Ag) over 183.0 m from the 'A-zone', located only 3.5 km west of the Coho property. To the north lies Pacific Ridge Resources' Chuchi property, where 2024 drilling returned 382.0 m of 0.19% Cu, 0.12 g/t Au, and 0.47 g/t Ag from the BP zone.
The Coho zone is defined by a 650 x 550 m Cu-Au-Ag surface rock and soil geochemical anomaly within diorite, and spatially associated with an ENE-trending fault zone (the Coho fault) and gabbro dykes. Two additional faults, the Valley and Redline faults, extend south from the BP zone (Chuchi property) and converge with the Coho fault at the Coho zone. Historic surface grab samples at the Coho zone returned values up to 16.15 g/t Au, 16.35% Cu, and 67.3 g/t Ag.
A recent (2022) airborne ZTEM (Z-axis Tipper electromagnetic) survey, followed by a 2023 ground-based induced polarization (IP) survey, identified an interpreted 400 m x 250 m x 200 m-deep porphyry intrusive complex (3D ZTEM anomaly) with a two-limbed IP chargeability high anomaly that spans more than 1.4 km.
11
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
The Coho zone is located 4.5 km south of the BP zone (Chuchi property) and is currently interpreted to be situated along the same Valley/Redline fault structure that hosts the BP zone. Alkalic porphyry deposits commonly occur in clusters and Trailbreaker's team believes the Coho property, in particular the Coho zone, may represent a Cu-Au porphyry system similar to the surrounding prospects and deposits. Trailbreaker has interpreted this system to be part of a cluster of deposits found along the margin of the Hogem batholith.
4.2 Atsutla Gold Project
On January 8, 2026, Trailbreaker announced results from its 2025 exploration program at the Atsutla Gold project in northwestern British Columbia. Detailed prospecting and mapping in the Highlands zone area has expanded the known footprint of high-grade gold showings and led to discovery of new high-grade copper-gold-silver (Cu-Au-Ag) showings on recently acquired claims.
Previous exploration at the Highlands zone led to discovery of a shallowly-dipping shear structure which hosts high-grade gold-bearing quartz veins, returning assays up to 630 g/t Au. During the 2025 program, the structure's continuity was explored on recently acquired claims, expanding the Highlands zone structural feature to a 1.0 km x 1.2 km area. A zone of high-grade copper and silver, the Highlands North zone, was also discovered 1.1 km north of the high-grade gold showings.
Mineralization at the Highlands zone is related to a much larger system (Atsutla West), which includes the Christmas Creek and Snook zones. Combined, this area covers 5.0 km x 4.3 km. Trailbreaker's team interprets the gold mineralization to be orogenic in nature, with multiple gold ± silver ± copper-bearing shear zones related to larger faults occurring in the area.
Trailbreaker's 100%-owned Atsutla Gold project is located 70 km south of the Yukon-British Columbia border and 120 km northwest of the Village of Dease Lake, BC. The project covers over 30,000 hectares of ground with very limited historic exploration.
The 2025 exploration program consisted of the collection of 147 soil samples and 77 prospecting grab samples during late August and early September. Final assays were not received until late December due to multiple re-analyses of high-grade gold, copper, and silver as well as additional QA/QC completed by Bureau Veritas Labs.
The purpose of the program was to further delineate the Highlands zone shear structure by additional prospecting in areas of previously discovered mineralization and on newly acquired claims to the west and north of the known gold zones.
Gold at the Highlands zone is found within quartz veins ranging from 10 cm to 60 cm thick occurring within a continuous, shallow-dipping shear structure. The gold-bearing quartz veins typically host galena and arsenopyrite, but commonly have no visible sulphide minerals. During 2025, this structure was traced along the side of a ridge for 1.0 km in a NE-SW direction. Rock samples taken from the northeast corner returned assays up to 221.6 g/t Au, and rocks taken from the southwest corner returned assays up to 9.32 g/t Au. The highest gold value returned, 401.8 g/t Au, 493 ppm Ag, was obtained from a rock taken 140 m from the previously discovered high-grade showings. The structure was traced for an additional 1.2 km to the west, onto newly acquired claims, where assays returned values up to 4.83 g/t Au.
A newly discovered zone of high-grade copper, termed the Highlands North zone, yielded up to 1.65% Cu, 5.92 g/t Au, and 551 ppm Ag (from separate rocks) in an area 1.1 km north of the high-grade gold showing at the Highlands zone. The high-grade copper values were returned from more steeply dipping quartz veins from 20 cm to 80 cm thick, hosting chalcopyrite, bornite, malachite, azurite, and pyrite. Five rock samples in this area returned assay values greater than 1% Cu, and eight samples returned values greater than 100 ppm Ag.
Reconnaissance soil sampling to the west of the Highlands North zone returned values up to 66 ppb Au, suggesting potential for additional mineralization in this direction.
Statistical analysis of rock and soil sample assays in the Highlands zone show that gold correlates with mercury, selenium, lead, silver, antimony, copper, and arsenic. High bismuth values also occur, but are generally related to high-grade copper.
12
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
Trailbreaker's team has interpreted the shear structure delineated at the Highlands zone to be continuous, with similar structures found at the Christmas Creek zone (1.5 km to the east), and the Snook zone (4.5 km to the north). The total surficial footprint of this area is 5.0 km x 4.3 km. Rock sampling indicates potential for further shear-hosted mineralized quartz veins at lower elevations along the slope, however much of this area is masked by a thick talus apron. Further rock sampling and geological mapping is warranted to test for their presence.
The Highlands zone and greater Atsutla West area are fully permitted for drilling. During the 2025 program, the Trailbreaker team ground-truthed potential drill pads to test the shear structure. The Swan target, situated 26 km to the southeast, is also fully permitted for drilling. The two areas represent different deposit models: Atsutla West is an orogenic Au target while Swan is a porphyry Cu-Au-Ag target.
5. Petroleum and natural gas Properties
As a result of its acquisition of Petro One, Trailbreaker indirectly acquired all of Petro One's petroleum assets, including the Milton Viking Oil Field (Saskatchewan) and a farmout well at Bromhead (Saskatchewan). Total oil production from all of the Company's wells between October 27, 2011 and June 30, 2025 was 33,311 bbl generating gross revenues of $2,576,403.
The only well that the Company retains 10% overriding royalty is in Bromhead Saskatchewan. The royalty income summary in 2024 and 2025 is as follows:
| BROMHEAD FARMOUT (PETRO ONE SHARE OF PRODUCTION BASED ON 10%ORR) | |||
|---|---|---|---|
| Quarter (Petro One) | oil m3 | oil bbl | Gross oil receipts |
| hz 191/5-30-3-2W2 | On production December 28, 2012 | ||
| January 1, 2024 – March 31, 2024 | 12 | 79 | 6,574 |
| April 1, 2024 – June 30, 2024 | 10 | 63 | 6,347 |
| July 1, 2024 – September 30, 2024 | 12 | 76 | 7,315 |
| October 1, 2024 – December 31, 2024 | 12 | 70 | 6,216 |
| January 1, 2025 – June 30, 2025 | 4 | 25 | 2,157 |
| July 1, 2025 – September 30, 2025 | 11 | 71 | 5,610 |
| October 1, 2025 – December 31, 2025 | 3 | 21 | 1,429 |
| Total | 64 | 405 | 35,648 |
J10 Prospect, Bromhead Saskatchewan
In 2012, the Company signed a farmout and royalty agreement with ARC Resources Ltd. on its 100% controlled J10 property at Bromhead, Saskatchewan. By paying 100% of the drilling and completion costs, ARC earned a 100% before payout and 70% after payout interest in the Test Well Spacing Unit to the base of the Frobisher, subject to a 10% gross overriding royalty (the "GORR") in favour of Petro One.
Having earned an interest in the southwest quarter of the Bromhead property by drilling the discovery well, ARC decided to drop its option on the remainder of the property, but indicated an intention to conduct additional drilling on its earned quarter in 2014, under the terms of the agreement, giving Petro One a 10% GORR on the additional wells, convertible at Petro One's option to a 30% working interest after payout.
ARC's earning well went on production December 28, 2012, with a three month average initial production of 110.3 barrels of oil per day (11 bopd for Petro One's 10% GORR). Total production from the farmout well to December 31, 2020 was 6,880 m3 (43,278 bbl), with an average production rate of approximately 25 bopd over the life of the well.
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
6. National Instrument 51-101 Disclosure
BOE means barrels of oil equivalent. It may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf:1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip, and does not represent a value equivalency at the wellhead.
BOE means barrels of oil equivalent. It may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf:1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip, and does not represent a value equivalency at the wellhead.
Oil production during a period is generally expressed in terms of "barrels per day", which indicates the total oil produced during a period divided by the number of hours that the well was in production during that period. "Barrels per day" is indicative of flow rate while a well is in production and does not mean that such well was in constant production during such period.
7. Future Outlook
The Company now holds nine mineral properties in BC and Yukon. The Atsutla Gold project has developed into the Company's flagship property with the discovery of widespread, high-grade gold across 26 kilometers. It remains undrilled. Permits to drill the Highlands and Swan areas have been granted and the Company is currently planning a 2026 drill program.
The newly-acquired Coho property is drill-ready, and drill permits have been granted. The Company is currently planning a 2026 drill program.
Drilling at the Liberty Copper project was successful in locating significant Cu-Mo mineralization in 2024. Large-scale geochemical and geophysical surveys have outlined further targets and the Company is currently planning the next steps for the project.
Trailbreaker is currently discussing forms of option agreements or joint ventures for the McMurdo and Plateau properties with interested third parties, as well as continuing to generate new targets in BC.
8. Selected Annual Information
| Year Ended December 31, 2025 $ | Year Ended December 31, 2024 $ | Year Ended December 31, 2023 $ | |
|---|---|---|---|
| Net and comprehensive gain (loss) | (850,005) | (402,675) | (3,681,817) |
| Basic loss per share | (0.02) | (0.01) | (0.14) |
| Total assets | 5,442,564 | 6,241,727 | 3,681,693 |
| Current liabilities | 297,470 | 332,689 | 195,726 |
| Working capital | 586,199 | 1,620,476 | 1,273,938 |
| Dividends | Nil | Nil | Nil |
In 2025, the most significant item that comprised the net loss of $850,005 was the impairment of exploration and evaluation assets of $406,803, management fees of $180,000, and office expenses of $116,100, offset by settlement of flow through premium of $43,352. Total assets decrease by $799,163 mainly due to a decrease in cash. As at the end of fiscal 2025, cash on hand was $801,785 (2024: $1,920,113); exploration and evaluation assets were valued at $4,392,404 (2024: $4,134,258) and working capital was $586,199 (2024: $1,620,476).
In 2024, the most significant item that comprised the net loss of $402,675 was stock based compensation of $315,959 management fees of $172,057, and office expenses of $130,491, offset by settlement of flow through premium of $349,148. Total assets increase by $2,560,034 mainly due to an increase in exploration and evaluation assets. As at the end of fiscal 2024, cash on hand was $1,920,113 (2023: $1,436,245); exploration and evaluation assets were valued at $4,134,258 (2023: $2,043,827). Working capital in 2024 was $1,620,476 (2023: $1,273,938).
14
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
In 2023, the most significant item that comprised the net loss of $3,681,817 was the impairment of exploration and evaluation assets of $3,280,692. Total assets decreased substantially in 2023 mainly due to a decrease of $1,991,708 in exploration and evaluation assets. As at the end of fiscal 2023, cash on hand was $1,436,245 (2022: $446,605); exploration and evaluation assets were valued at $2,043,827 (2022: $4,035,535). Working capital in 2023 was $1,273,938 (2022: $376,646).
9. Results of operations
9.1 For the year ended December 31, 2025 Review:
For the year ended December 31, 2025, the Company recorded a net loss of $819,944 as compared to a net loss of $412,416 for the year ended December 31, 2024. The main contributing factors for the net loss in the current year were impairment of exploration and evaluation assets of $406,8003, management fee of $180,000 and office expenses of $116,100, offset by settlement of flow-through premium of $43,352..
Major accounts that changed notably for the periods were as follows:
| December 31, 2025 | December 31, 2024 | |||
|---|---|---|---|---|
| $ | $ | Change | ||
| Expenses: | ||||
| Listing and filing fees | 51,567 | 65,754 | (14,187) | 1 |
| Management fees | 180,000 | 172,057 | 7,943 | 2 |
| Office and miscellaneous | 116,100 | 130,491 | (14,391) | 3 |
| Professional fees | 74,979 | 88,116 | (13,137) | 4 |
| Stock-based compensation | - | 315,956 | (315,956) | 5 |
| (422,646) | (772,374) | 349,728 | ||
| Impairment of exploration and evaluation assets | (406,803) | (6,582) | (400,221) | |
| Expenditure on petroleum and natural gas properties | (19,017) | (20,319) | 1,302 | |
| Amortization | (598) | (1,071) | 473 | |
| Due diligence for mineral interests | (15,430) | (69,196) | 53,766 | |
| Settlement of flow-through share premium | 43,352 | 349,148 | (305,796) | |
| All other accounts | (28,863) | 117,719 | (146,582) | |
| Items that will not be reclassified to profit or loss Change in fair value on equity investments designated on FVTOCI, net of tax | 30,061 | (9,741) | 39,802 | |
| Total | (819,944) | (412,416) | (407,528) |
- Listing and filing fees decreased by $14,187 mainly due to less filing fees required during the current year.
- Management fees increased by $7,943.
- Office expenses decreased by $14,391 due to less business activities during 2025.
- Professional fees decreased by $13,137 due to less professional services utilized in the current year.
- No new stock options granted in the current year.
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
9.2 For the three months ended December 31, 2025 Review:
For the three months ended December 31, 2025, the Company recorded a net loss of $520,954 as compared to a net income of $267,894 for the three months ended December 31, 2024. The main contributing factors for the net income last year was the settlement of flow-through premium of $349,148.
Major accounts that changed notably for the periods were as follows:
| December 31, 2025 | December 31, 2024 | |||
|---|---|---|---|---|
| $ | $ | Change | ||
| Expenses: | ||||
| Listing and filing fees | 8,416 | 13,543 | (5,127) | 1 |
| Management fees | 45,000 | 45,000 | - | |
| Office and miscellaneous | 33,648 | 66,685 | (33,037) | 2 |
| Professional fees | 30,227 | 22,429 | 7,798 | 3 |
| Stock-based compensation | - | (19,000) | 19,000 | 4 |
| (117,291) | (128,657) | 11,366 | ||
| Impairment of exploration and evaluation assets | (405,303) | - | (405,303) | |
| Expenditure on petroleum and natural gas properties | (11,561) | (13,769) | 2,208 | |
| Amortization | (120) | (212) | 92 | |
| Due diligence for mineral interests | (2,170) | (8,761) | 6,591 | |
| Settlement of flow-through share premium | - | 349,148 | (349,148) | |
| All other accounts | 303 | 83,446 | (83,143) | |
| - | - | - | ||
| Items that will not be reclassified to profit or loss Change in fair value on equity investments designated on FVTOCI, net of tax | 15,188 | (13,301) | 28,489 | |
| Total | (520,954) | 267,894 | (788,848) |
- Listing and filing fees decreased by $5,127 mainly due to less filing fees required during the current period.
- Office expenses decreased by $33,037 mainly due to one time director fee paid in 2024.
- Professional fees increased by $7,798.
9.3 Resource Property Expenditures:
For the year ended December 31, 2025, exploration and evaluation assets increased by $258,146 (2024 - $2,090,431), the total valuation increased to $4,392,404 (2024 - $4,134,258). The increase in the capital expenditure was mainly due to trenching and drilling of $237,000, and geological and geophysical consulting fees of $110,450.
For a detailed breakdown, see the mineral property schedule in Note 5 of the Company's audited consolidated financial statements for the year ended December 31, 2025.
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
10. Quarterly Financial Information
| 2025-12-31 | 2025-09-30 | 2025-06-30 | 2025-03-31 | |
|---|---|---|---|---|
| Description | $ | $ | $ | $ |
| Operations | ||||
| Interest and other income | 8,556 | 5,614 | 5 | 4,223 |
| Expenses | (125,541) | (121,550) | (94,242) | (128,563) |
| Expenditure on petroleum and natural gas properties | (11,561) | - | (7,456) | - |
| Impairment of exploration and evaluation assets | (405,303) | (1,500) | - | - |
| Settlement of flow-through share premium | - | - | - | 43,352 |
| Due diligence for mineral interests | (2,170) | 5,373 | (10,783) | (7,850) |
| Other non-cash charges | (120) | (137) | (158) | (183) |
| Foreign exchange gain | (3) | 4 | (12) | - |
| Net loss | (536,142) | (112,196) | (112,646) | (89,021) |
| Unrealized gain on investments in marketable securities | 15,188 | 3,975 | 8,098 | 2,800 |
| Comprehensive income (loss) | (520,954) | (108,221) | (104,548) | (86,221) |
| Basic gain (loss) per share | (0.01) | (0.00) | (0.00) | (0.00) |
| Total Assets | ||||
| Cash and cash equivalents | 801,785 | 956,115 | 1,308,656 | 1,466,415 |
| Marketable securities | 54,188 | 31,875 | 27,900 | 27,215 |
| Other current assets | 27,696 | 30,855 | 11,884 | 32,429 |
| Restricted cash | 165,700 | 165,700 | 128,500 | 128,500 |
| Exploration and valuation assets | 4,392,404 | 4,740,196 | 4,557,718 | 4,460,101 |
| Equipment and other assets | 791 | 911 | 1,047 | 1,206 |
| 5,442,564 | 5,925,652 | 6,035,705 | 6,115,866 | |
| 2024-12-31 | 2024-09-30 | 2024-06-30 | 2024-03-31 | |
| --- | --- | --- | --- | --- |
| Description | $ | $ | $ | $ |
| Operations | ||||
| Interest and other income | 89,288 | 20,077 | 16,032 | 7,171 |
| Expenses | (134,514) | (114,444) | (109,376) | (428,904) |
| Expenditure on petroleum and natural gas properties | (13,769) | (6,550) | - | - |
| Impairment of exploration and evaluation assets | - | - | (5,131) | (1,451) |
| Settlement of flow-through share premium | 349,148 | - | - | - |
| Due diligence for mineral interests | (8,761) | (52,177) | (3,258) | (5,000) |
| Other non-cash charges | (212) | (245) | (284) | (330) |
| Foreign exchange gain | 15 | - | - | - |
| Net loss | 281,195 | (153,339) | (102,017) | (428,514) |
| Unrealized (loss) gain on investments in marketable securities | (13,301) | (2,513) | 8,336 | (2,263) |
| Comprehensive income (loss) | 267,894 | (155,852) | (93,681) | (430,777) |
17
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
| 2024-12-31 | 2024-09-30 | 2024-06-30 | 2024-03-31 | |
|---|---|---|---|---|
| Description | $ | $ | $ | $ |
| Basic gain (loss) per share | 0.01 | (0.00) | (0.00) | (0.01) |
| Total Assets | ||||
| Cash and cash equivalents | 1,920,113 | 2,260,484 | 3,138,234 | 1,449,632 |
| Other current assets | 33,052 | 87,998 | 80,268 | 36,086 |
| Restricted cash | 128,500 | 128,500 | 103,500 | 103,500 |
| Marketable securities | 24,415 | 27,916 | 42,029 | 86,478 |
| Exploration and valuation assets | 4,134,258 | 3,820,908 | 3,189,641 | 2,180,150 |
| Equipment and other assets | 1,389 | 1,600 | 1,846 | 2,131 |
| 6,241,727 | 6,327,406 | 6,555,518 | 3,857,977 |
Quarter ending December 31, 2025: Normal operating expenses for the quarter with the exception of recognizing impairment of exploration and evaluation assets of $403,303.
Quarter ending September 30, 2025: Normal operating expenses for the quarter.
Quarter ending June 30, 2025: Normal operating expenses for the quarter.
Quarter ending March 31, 2025: Normal operating expenses for the quarter with the exception of recognizing settlement of flow through share premium of $43,352.
Quarter ending December 31, 2024: Normal operating expenses for the quarter with the exception of recognizing settlement of flow through share premium of $349,148.
Quarter ending September 30, 2024: Normal operating expenses for the quarter.
Quarter ending June 30, 2024: Normal operating expenses for the quarter.
Quarter ending March 31, 2024: Normal operating expenses for the quarter with the exception of recognizing stock-based compensation of $334,956.
11. Liquidity and Capital Resources
At this time, the Company has no operating revenues and does not anticipate any operating revenues until the Company is able to find, acquire, or place in production and operate a mining property. Historically, the Company has raised funds through loans, shares for debt settlements, private placements and the exercise of options and warrants. Through such means, the Company raised in excess of $7,000,000 since 2011.
On November 17, 2025, the Company issued 25,000 common shares at $0.30 per share for a fair value of $7,500 pursuant to the amended option agreement for the Atsula property.
In June 2025, the Company issued 50,000 common shares at $0.38 per share for a fair value of $19,000 pursuant to an option agreement for the Coho property.
In March 2025, the Company issued 50,000 common shares for stock options exercised at a price of $0.24, for gross proceeds of $12,000. The share price on the date of exercise was $0.40.
In January 2025, the Company issued 50,000 common shares at $0.35 per share for a fair value of $17,500 pursuant to an option agreement for the Liberty property..
18
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
As of December 31, 2025, based on expenditures incurred, the remaining flow-through share premium liability of $43,352 (2024 - $349,148) was recognized as a settlement of flow-through share premium in the consolidated statements of comprehensive loss, leaving nil balance in the flow-through share premium liability.
On April 10, 2024, the Company closed a non-brokered private placement, issuing 1,406,250 Critical Flow-Through Units for $0.64 per Critical Flow-Through Unit (the "CMETC FT Units"), and 2,593,750 Flow-Through Units for $0.56 per Non-Critical Flow-Through Unit (the "FT Units"), for aggregate gross proceeds of $2,352,500.
Each CMETC FT Unit consists of one flow-through common share ("FT Share") and one half of a transferable warrant, each warrant being exercisable to acquire an additional non-flow-through common share of the Company at $0.60 for 24 months from the date of issuance. Each FT Unit consists of one FT Share and one half of a warrant, each warrant being exercisable to acquire an additional non-flow-through common share of the Company at $0.60 for 24 months from the date of issuance.
The Company paid cash finders' fees of $15,000 and filing fee of $14,944.
The FT Units were issued at a premium in recognition of the tax benefits accruing to subscribers. The flow-through premium was calculated to be $392,500 and was recorded as a share capital reduction with an equivalent amount as a flow-through share premium liability in the statement of financial position. As of December 31, 2024, based on expenditures incurred, $349,148 was recognized as a settlement of flow-through share premium leaving a $43,352 balance in the flow-through share premium liability.
During the year ended December 31, 2024, the Company issued 500,000 and 1,672,700 common shares for warrants exercised at the exercise price of $0.15 and $0.25, for gross proceeds of $75,000 and $418,715, respectively.
During the year ended December 31, 2024, the Company issued 310,000 common shares for stock options exercised at the exercise price of $0.24 for a gross proceed of $74,400. The share price on the date of exercise was $0.52.
In February 2024, the Company issued 50,000 common shares at $0.42 per share for a fair value of $21,000 pursuant to an option agreement for the Liberty property.
During the year ended December 31, 2025, the Company incurred and renounced the remaining $259,835 exploration expenses under its flow-through program.
During the year ended December 31, 2024, the Company incurred and renounced $900,000 of exploration expenses under its critical flow-through program and $1,192,665 of exploration expenses under its flow-through program.
As at December 31, 2025, the Company had cash of $801,785 (2024 - $1,920,113) and working capital of $586,199 (2024 - $1,620,476). Currently and into the foreseeable future, the Company is able to fund overhead expenses and to meet obligations committed to maintaining ownership and rights pertaining to all of the Company's mineral properties. The Company has no significant financial commitments.
For the remainder of the fiscal year and beyond, significant resources will be required to finance the Company's planned exploration expenditures. While there are no assurances new funds can be raised, management believes such financing will be made available as required.
The Company manages its capital base by monthly, quarterly and annual cash flow forecasts. The timing and extent of both program implementation and financing are determined by management's evaluation of economic factors at the time, such as commodity prices, interest rates and foreign exchange, and non-economic factors such as expected impact that completion of a given program may have on the cost of capital.
12. Off-Balance Sheet Arrangements
The Company does not utilize off-balance sheet arrangements.
19
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
13. Transactions with Related Parties
Key personnel compensation:
| December 31, 2025 | December 31, 2024 | |
|---|---|---|
| Management and accounting fees incurred to a company controlled by the Chief Financial Officer | $ 156,000 | $ 144,000 |
| Management fees incurred to a company controlled by the President and Chief Executive Officer | $ 71,250 | $ 42,921 |
| Exploration management fees incurred to a company controlled by the President and Chief Executive Officer and capitalized to exploration and evaluation assets | $ 132,750 | $ 136,003 |
| Directors' fees incurred to directors | $ 12,000 | $ 37,000 |
| Share-based payments to directors | $ - | $ 78,989 |
As at December 31, 2025, $201,548 (December 31, 2024 - $191,161) was owing to related parties and has been included in accounts payables and accrued liabilities. The amounts are unsecured, non-interest bearing and due on demand.
On January 25, 2024, 200,000 stock options were granted to officers of the Company exercisable at a price of $0.43 per share for a term of five years. The options were fully vested on the grant date.
14. Critical Accounting Estimates
A detailed summary of all the Company's significant accounting policies is included in Note 2 of the Company's audited consolidated financial statements for the year ended December 31, 2025.
15. Outstanding Share Data
The following securities were outstanding as at April 13, 2026:
| Securities | Number | Weighted-Average Exercised Price | Expiry Date |
|---|---|---|---|
| Common shares issued and outstanding | 51,214,834 | N/A | N/A |
| Share purchase options | 1,032,500 | 0.45 | April 28, 2026 - January 25, 2029 |
| Share purchase warrants | 7,600,000 | 0.20 | May 4, 2026 - March 25, 2028 |
| Fully diluted share capital | 59,847,334 | N/A | N/A |
For a breakdown of the securities as at December 31, 2025 refer to Note 8 of the audited consolidated financial statements for the year ended December 31, 2025.
16. Proposed Transactions
In January 2026, the Company paid $5,000 cash and issued 50,000 common shares at $0.43 for a fair value of $21,500 pursuant to an option agreement for the Liberty property.
In March 2026, the Company completed a non-brokered charity flow-through private placement (the "Offering") for gross proceeds of $3.5 million. The Company issued:
- 2,500,000 CMETC flow-through units ("CMETC FT Units") at a price of $0.56 per CMETC FT Unit, for aggregate gross proceeds of $1.4 million, each CMETC FT Unit consisting of 1 CMETC FT common share and ½ of a common share purchase warrant, each of which will qualify as a "flow-through share". Each full warrant is exercisable at $0.50 for 24 months from the date of issue for one non-flow-through common share; and
TRAILBREAKER RESOURCES LTD.
Management's Discussion and Analysis
For the year ended December 31, 2025 and 2024
- 4,200,000 flow-through units ("FT Units") at a price of $0.50 per FT Unit for aggregate gross proceeds of $2.1 million, each FT Unit consisting of 1 FT common share and ½ of a common share purchase warrant, each of which will qualify as a "flow-through share". Each full warrant is exercisable at $0.50 for 24 months from the date of issue for one non-flow-through common share.
All of the FT Units and CMETC FT Units issued pursuant to the Offering are subject to a hold period in Canada of four months plus one day from closing.
The Company has paid cash finders' fees totaling $108,150 and issued 324,000 non-transferable broker warrants exercisable at $0.50 for 2 years, in accordance with TSX-V policies.
In March 2026, the Company extended the term of 2,000,000 warrants by one year to April 10, 2027 from April 10, 2026. All other terms remain unchanged.
In April 2026, the Company issued 3,750,000 common shares for warrants exercised at the exercise price of $0.15 for gross proceeds of $562,500.
17. Risk Factors
The Company operates as a mineral explorer in the mining industry, which presents the Company with new risks and uncertainties. Mineral exploration involves considerable financial and technical risks. Substantial time and expenditures are usually required to make a discovery and to establish economic ore reserves. It is impossible to assure that the current exploration properties and programs planned by the Company will result in an economic mineral discovery and development. Accordingly, success in achieving the objectives of the Company is affected by many circumstances over which the Company has no control. There is inherent risk in the exploration for mineral resources that is unavoidable.
Also, there are risks associated with the impact of commodity prices on the valuation of mineral properties and share prices and general changes in economic conditions.
Currency risk – The Company's operations are in Canada with most of its expenses being incurred in Canadian dollars. Therefore, currency risk is minimal.
Commodity risk – The valuation of the Company's gold as well as petroleum & natural gas projects and consequently its access to capital are influenced by the price of gold and oil. The price of gold has continued to be robust, yet the price oil has taken a severe beat. The long term trend of the price is unpredictable.
Market risk – The Company's mineral exploration activities have to be financed either through joint ventures or in the capital markets through the sale of its Common Shares. The ability of the Company to raise exploration funds in the capital market is highly dependent on the value the market places on the Company's mineral properties and the strength of the metal markets. The value the market places on the Company's mineral properties is directly related to the grade and thickness of the contained mineralization being reported and the potential to develop mineral values into an economic deposit. There is no assurance that the Company will be successful in obtaining the required financing.
Since September 2008, the securities markets in Canada have experienced a high level of price and volume volatility, and the market prices of securities of many companies, particularly those considered exploration stage companies, have experienced wide fluctuations which have not necessarily been related to the operating performance, underlying asset values or prospects of such companies. There can be no assurance that continual and extreme fluctuations in price will not occur. Share prices of these companies have trended downward making equity financing for many in the shorter term extremely difficult.