HSLV Management's Discussion and Analysis Q3 2025

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# HSLV MDA Q3 2025 FINAL

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# HSLV MDA Q3 2025 FINAL
Highlander Silver Corp.
Management’s Discussion and Analysis
For the three and nine months ended June 30, 2025 and 2024
Highlander Silver Corp.
Management’s Discussion and Analysis
For the three and nine months ended June 30, 2025 and 2024
(Expressed in Canadian dollars, unless otherwise noted)
INTRODUCTION
This Management’s Discussion and Analysis (“MD&A”) of Highlander Silver Corp. (the “Company” or “Highlander”)
provides information on the Company’s business activities, financial condition, financial performance, cash flows and
outlook for the three and nine months ended June 30, 2025, with comparative information for the three and nine months
ended June 30, 2024. This MD&A is dated August 12, 2025 and takes into account information available up to and
including that date.
The Company reports its financial position, financial performance and cash flows in accordance with IFRS Accounting
Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). This MD&A should be read in
conjunction with the Company’s condensed consolidated interim financial statements for the three and nine months
ended June 30, 2025 and the annual consolidated financial statements for the year ended September 30, 2024, which
are available on the Company’s website at www.highlandersilver.com and on the SEDAR+ website at
www.sedarplus.ca. Additional information relating to the Company, including the Company’s Annual Information Form,
is also set out on the SEDAR+ website at www.sedarplus.ca.
All dollar amounts reported herein are expressed in Canadian dollars unless otherwise indicated.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION
This document includes certain statements that constitute "forward-looking statements", and "forward-looking
information" within the meaning of applicable securities laws (collectively, "forward-looking statements"). Words such
as "intends", "expects", "will be", "underway", "targeted", "planned", "objective", "expected", "potential", "continue",
"estimated", "would", "subject to" and similar expressions are intended to identify these forward-looking statements.
Forward-looking statements in herein include, but are not limited to: statements regarding the Company’s exploration
and development plans at San Luis, including specific phases, plans, timing, costs, results thereof, and other disclosure
set out under “Exploration Plans” herein; the Company’s plan for the San Luis Project is to advance the project through
integrated exploration, environmental and community development programs; the Company’s aim of employing its
participatory development model based on community capacity building through skill and safety training, employment,
entrepreneurship, infrastructure development and environmental, cultural, health and education programs; specific
timing and costs of the Company’s proposed exploration program, including timing and cost of implementing Phase 1
and Phase 2 as recommended in the Technical Report; the Company expects to continue to obtain the necessary funds
primarily through the issuance of common shares in support of its business objectives; intended use of proceeds from
the Offering; the Company, upon approval from its Board of Directors, intends to balance its overall capital structure
through a combination of equity financing and/or other forms of financing; and that the Company’s planning and
budgeting will ensure the Company has appropriate liquidity to meet its business activities, including planned corporate
expenditures, exploration expenses, as well as the development activities for the San Luis Project.
Although the Company believes that the expectations reflected in such forward-looking statements are reasonable,
undue reliance should not be placed on forward-looking statements since the Company can give no assurance that
such expectations will prove to be correct. These statements involve known and unknown risks, uncertainties and other
factors that may cause actual results or events to differ materially from those anticipated in such forward-looking
statements, including risks related to the business of the Company; the ability of the Company to raise sufficient capital;
general business, economic, competitive, political and social uncertainties; the actual results of current exploration
activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future
prices of precious and base metals; accidents; global outbreaks and contagious diseases (including COVID-19);
business and economic conditions in the mining industry generally; the supply and demand for labour and other project
inputs; adverse claims made by local communities; changes in commodity prices; unanticipated exploration and
development challenges (including failure of equipment or processes to operate in accordance with specifications or
expectations, cost escalation, unavailability of materials and equipment, government action or delays in the receipt of
government approvals, industrial disturbances or other job action, and unanticipated events related to health, safety
and environmental matters); adverse weather conditions; political risk and social unrest; changes in interest and
currency exchange rates; and the risks, uncertainties and other factors identified in the Company's periodic filings with
Canadian securities regulators.
Page 1
Highlander Silver Corp.
Management’s Discussion and Analysis
For the three and nine months ended June 30, 2025 and 2024
(Expressed in Canadian dollars, unless otherwise noted)
These forward-looking statements were derived using numerous assumptions, including assumptions regarding
general business and economic conditions; the Company’s ability to develop and maintain relationships with local
communities; commodity prices; anticipated costs and expenditures; the Company’s ability to advance exploration
efforts at San Luis and La Estrella; and the results of such exploration efforts. While the Company considers these
assumptions to be reasonable based on information currently available, they may prove to be incorrect. Forward-looking
statements speak only as of the date those statements are made. Except as required by applicable law, we assume no
obligation to update or to publicly announce the results of any change to any forward-looking statement contained
herein to reflect actual results, future events or developments, changes in assumptions or changes in other factors
affecting the forward- looking statements. If we update any forward-looking statements, no inference should be drawn
that we will make additional updates with respect to other forward-looking statements. All forward-looking statements
contained herein are expressly qualified in their entirety by this cautionary statement.
DESCRIPTION OF BUSINESS
Highlander is primarily focused on advancing the bonanza grade San Luis gold-silver project located adjacent to the
past-producing Pierina mine in Central Peru (the “San Luis Project”). San Luis hosts Indicated Mineral Resources of
356 koz Au at 24.4 g/t Au and 8.4 Moz Ag at 579 g/t Ag and Inferred Mineral Resources of 8 koz Au at 4.9 g/t Au and
336 koz Ag at 202 g/t Ag.
Highlander is listed on the Toronto Stock Exchange (the “TSX”) under the ticker symbol “HSLV”.
HIGHLIGHTS AND ACTIVITIES
The following activities and developments were achieved during the quarter:
On May 12, 2025, Highlander announced the commencement of infrastructure programs with the participation of its
community partners to support the start of drilling at the San Luis Project.
On May 13, 2025, the Company’s common shares commenced trading on the TSX and were delisted from the Canadian
Securities Exchange.
On June 9, 2025, Highlander announced that it had commenced its maiden drilling program targeting recently sampled
but previously undrilled high grade mineralization in outcrop at the Bonita vein system located approximately 10 km to
the south of the Ayelen deposit at its San Luis Project.
On June 12, 2025, Highlander made a US$1,250,000 payment to SSR Mining Inc. (“SSR Mining”) in relation to the first
contingent cash consideration of the share purchase agreement (stated below) between the Company and SSR Mining.
Subsequent Event
On July 29, 2025, Highlander reported assay results from the first seven holes drilled to test a conceptual open pit
target along a ridgeline where the Bonita vein system is exposed 10 km to the south of the Ayelen underground deposit
at its San Luis Project. Drilling is ongoing with one drill rig and regulatory approval has been recently obtained to expand
the program to include a second drill rig.
MINERAL PROPERTIES AND OUTLOOK
San Luis
On May 23, 2024, the Company announced closing of the acquisition of the San Luis Project from SSR Mining Inc.
(“SSR Mining”), pursuant to the share purchase agreement between the Company and SSR Mining dated November
29, 2023, as amended (the “SPA”). The project is located in the Ancash Department, which is well-known for mining in
Peru with major past and present production from the Pierina gold mine and Antamina copper-zinc mine, respectively.
San Luis currently hosts Indicated Mineral Resources of 356 koz Au at 24.4 g/t Au and 8.4 Moz Ag at 579 g/t Ag and
Inferred Mineral Resources of 8 koz Au at 4.9 g/t Au and 336 koz Ag at 202 g/t Ag.
Page 2
Highlander Silver Corp.
Management’s Discussion and Analysis
For the three and nine months ended June 30, 2025 and 2024
(Expressed in Canadian dollars, unless otherwise noted)
The mineral resource estimate is hosted within the Ayelen vein system and is open in multiple directions. Furthermore,
there are multiple targets for growth on the property given limited and focused historical drilling, and undrilled targets
supported by highly anomalous (> 4 g/t Au) trenching and rock samples. The extensive land holding totaling more than
23,000 hectares has yet to be systematically explored with many structures that have not yet been sampled and
extensions of vein trends under cover that have not been tested providing further exploration potential. Given this,
Highlander plans to implement a comprehensive program of geological mapping, sampling, and geophysical surveys
to develop a technical assessment of the discovery potential before more focused exploration on the highest priority
targets.
The Company acquired the San Luis Project for upfront cash consideration of US$5,000,000 and an additional
US$37,500,000 in contingent cash consideration (the “Contingent Consideration”) upon completion of the following
milestones in relation to the San Luis Project pursuant to the SPA:
(a) US$1,250,000 after the commencement of an initial drilling program (this has been paid to-date);
(b) US$1,250,000 after the first anniversary of the commencement of an initial drilling program;
(c) US$5,000,000 after the completion of a feasibility study;
(d) US$10,000,000 after the beginning of commercial production;
(e) US$10,000,000 after the first anniversary of commercial production; and
(f) US$10,000,000 after the second anniversary of commercial production.
The Contingent Consideration is only accrued and payable if and when the above milestones are achieved.
Pursuant to the SPA, a 4% net smelter returns royalty (the “Royalty”) on the San Luis Project was granted to SSR
Mining. At any time before the commencement of mine construction on the San Luis Project, the Company may buy
back half of the Royalty for US$15,000,000, which if, exercised, would reduce SSR Mining’s royalty interest to 2%.
Exploration Plans
The Company’s plan for the San Luis Project is to advance the project through integrated exploration, environmental
and community deve

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