Valor Gold Corp MDA Q2 2026 081326 final

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# Valor Gold Corp MDA Q2 2026 081326 final

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# Valor Gold Corp MDA Q2 2026 081326 final
Valor Gold Corp. - MD&A - Q2 2026
VALOR GOLD CORP.
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2026
(Expressed in Canadian dollars unless otherwise noted)
Page 1
Valor Gold Corp. - MD&A - Q2 2026
DATE
This Management's Discussion and Analysis ("MD&A") of Valor Gold Corp. ("Valor" or the
"Company") was prepared by management as at August 13, 2026, and has been reviewed
and approved by the Audit Committee and the Board of Directors of the Company. This
MD&A should be read in conjunction with the Company's condensed interim consolidated
financial statements for the three and six months ended June 30, 2026, and 2025 (the
"Interim Financial Statements"), which have been prepared in accordance with
International Accounting Standard 34, Interim Financial Reporting ("IAS 34"), and IFRS®
Accounting Standards ("IFRS") as issued by the International Accounting Standards Board
("IASB"). The information provided herein supplements but does not form part of the Interim
Financial Statements.
This MD&A has been prepared following the requirements of National Instrument 51-102 -
Continuous Disclosure Obligations ("NI 51-102"). This is Valor's first interim MD&A prepared
following completion of the plan of arrangement described below (the "Arrangement") and
the listing of Valor's common shares on the Toronto Stock Exchange ("TSX") under the symbol
"VGC". All currency amounts are expressed in Canadian dollars unless otherwise noted.
Unless otherwise indicated, the scientific and technical disclosure contained within this
MD&A has been reviewed and approved by Marcus Adam, VP Exploration, a qualified
person for the purpose of National Instrument 43-101 - Standards of Disclosure for Mineral
Projects ("NI 43-101").
FORWARD-LOOKING INFORMATION
This MD&A contains "forward-looking information" within the meaning of Canadian securities
legislation and "forward-looking statements" within the meaning of the United States Private
Securities Litigation Reform Act of 1995 (collectively, "forward-looking statements"). All
statements, other than statements of historical fact, which address activities, events, or
developments that Valor believes, expects, or anticipates will or may occur in the future are
forward-looking statements. Forward-looking statements in this MD&A include, but are not
limited to, statements regarding: Valor's anticipated exploration, evaluation and
development activities at the Courageous Lake Project; the adequacy of Valor's financial
resources and future financing requirements; the classification and accounting treatment of
the Gold Purchase Agreement deposit; Valor's ability to satisfy its obligations as they come
due; and other events or conditions that may occur in the future.
Forward-looking statements are frequently, but not always, identified by words such as
"expects," "anticipates," "believes," "intends," "estimates," "plans," "potential," "possible," and
similar expressions, or statements that events, conditions, or results "will," "may," "could," or
"should" occur or be achieved. Forward-looking statements are based on management's
current beliefs, plans and expectations and are inherently uncertain; actual results may
differ materially from those reflected in forward-looking statements due to a variety of risks,
uncertainties and other factors, including those described under "Risks and Uncertainties"
below. Valor assumes no obligation to update forward-looking statements except as
required by law. Investors should not place undue reliance on forward-looking statements.
Page 2
Valor Gold Corp. - MD&A - Q2 2026
DESCRIPTION OF BUSINESS
Valor Gold Corp. was incorporated under the Canada Business Corporations Act on
January 19, 2026, as a wholly owned subsidiary of Seabridge Gold Inc. ("Seabridge").
Pursuant to the Arrangement completed in June 2026, Valor acquired 100% ownership of
Seabridge Gold (NWT) Inc. ("Seabridge NWT"), the owner of the Courageous Lake gold
project ("Courageous Lake" or the "Project") located in the Northwest Territories, Canada.
Concurrent with closing of the Arrangement, all shares of Valor held by Seabridge were
distributed to Seabridge shareholders, and Valor ceased to be a subsidiary of Seabridge.
Valor's common shares began trading on the TSX under the symbol "VGC" on June 5th, 2026,
and are quoted on the OTCQB Venture Market in the United States under the symbol
“VLGDF”.
Courageous Lake is Valor's sole material mineral property. Valor is an exploration and
development stage issuer and does not currently generate revenue from operations.
Valor's registered and head office is located in Toronto, Ontario. Valor also has a US
subsidiary, Valor Gold US Corp., a California corporation, established to support US-based
personnel and administrative functions.
CORPORATE REORGANIZATION
Valor was incorporated as a wholly owned subsidiary of Seabridge on January 19, 2026.
During the period ended June 30, 2026, Valor was involved in a series of transactions as part
of the Arrangement, which was approved by the shareholders of Seabridge on May 22,
2026, and completed on June 3, 2026 (the "Effective Date"). Components of the
Arrangement include:
● the transfer of Seabridge NWT, the owner of Courageous Lake, to Valor in exchange
for consideration described below;
● the distribution of all Valor common shares held by Seabridge to Seabridge
shareholders by way of a share distribution, following which Valor ceased to be a
subsidiary of Seabridge;
● the entering into of a gold purchase agreement between Valor and Seabridge (the
"GPA"), described under "Gold Purchase Agreement" below; and
● the listing of Valor's common shares on the TSX under the symbol "VGC" and
quotation on the OTCQB Venture Market.
On the Effective Date, Valor received the following from Seabridge pursuant to the
Arrangement. Valor did not assume any amounts receivable or trade and other payables
and held no cash prior to the Effective Date.
Cash consideration received from Seabridge $ 5,100,000
Deferred Revenue deposit received from Seabridge 4,900,000
Total cash received pursuant to the Arrangement $ 10,000,000
Mineral interests transferred $ 2,223,455
Page 3
Valor Gold Corp. - MD&A - Q2 2026
OBJECTIVES AND STRATEGY
Valor's principal focus is the further exploration, evaluation and advancement of the
Courageous Lake Project toward development and production. Valor may also pursue
selective acquisitions of additional gold projects that align with its long-term growth
strategy.
OVERVIEW OF PERFORMANCE - SECOND QUARTER 2026
Key developments during the three and six months ended June 30, 2026, include:
● Completion of the Arrangement and listing of Valor's common shares on the TSX
under the symbol "VGC", with concurrent OTCQB quotation in the United States
under the symbol "VLGDF".
● Receipt of a $4,900,000(US$3,591,000) deposit from Seabridge under the Gold
Purchase Agreement, recognized as deferred revenue in connection with the grant
of a 10% interest in future gold production from the Courageous Lake Project,
together with $5,100,000 in Arrangement cash consideration;
● Establishment of Valor's Board of Directors, Audit Committee, and Compensation
Committee;
● Grants of restricted share units ("RSUs") and deferred share units ("DSUs") to directors,
officers, employees and certain consultants under Valor's rolling equity incentive
plan;
● Continued advancement of exploration, evaluation and permitting work at
Courageous Lake.
● Meeting with indigenous groups, communities and regulators in the Northwest
Territories.
Financial highlights for the quarter are summarized under "Selected Financial Information"
below.
GOLD MARKET OVERVIEW
Gold prices during the first half of 2026 continued to be influenced by macroeconomic
factors including real interest rates, inflation expectations, US dollar movements, central
bank purchasing activity, and geopolitical conditions, including escalating tensions in the
Middle East.
As an exploration and development stage issuer, Valor does not generate operating
revenue and is dependent on the proceeds of the Arrangement and future equity or other
financing to fund its exploration, development and administrative activities. Sustained
strength in gold prices generally supports improved market conditions and financing
opportunities for exploration companies. Management continues to monitor gold price
trends in planning Valor's exploration activities and capital requirements.
Page 4
Valor Gold Corp. - MD&A - Q2 2026
MINERAL INTERESTS
Courageous Lake consists of 85 Northwest Territories Mining Leases and 4 Federal Mining
Leases, covering a total area of approximately 50,240 hectares, located approximately 240
km northeast of Yellowknife, Northwest Territories.
Following completion of the Arrangement, Valor continued to record the Courageous Lake
mineral interest at Seabridge's historical carrying value, consistent with the basis of
presentation in Valor's carve-out financial statements. No adjustment to the carrying value
of the mineral interest was required as a result of the Arrangement. Management continues
to apply its policy of capitalizing project-related costs as evaluation in nature, consistent
with the criteria satisfied by the 2024 Pre-Feasibility Study.
Mineral property expenditures capitalized during the three and six months ended June 30,
2026 are summarized under "Investing Activities" below.
The continuity of the Courageous Lake mineral interest is as follows:
Mineral interest Amount
Opening balance, December 31, 2025 $ 1,869,428
Additions as of completion of the Arrangement 354,395
Additions – mineral interest expenditures 374,667
Closing balance, June 30, 2026 $ 2,598,490
Subsequent to the end of the quarter, Valor Gold initiated a field program at the
Courageous Lake project. The goals of this program were to refine geological controls on
mineralization, to reinitiate environmental baseline permitting and to prepare the camp
and facilities for a winter drill program in early 2027.
GOLD PURCHASE AGREEMENT
In connection with the Arrangement, Valor entered into the GPA with Seabridge, granting
Seabridge a 10% interest in future gold production from Courageous Lake if the quarterly
average spot gold price exceeds US$4,000 per ounce, with gold delivered to Seabridge
under the GPA sold at a fixed price of US$4,000 per ounce. Seabridge provided a
$4,900,000 (US$3,591,000) deposit to Valor in consideration for the grant.
Management has assessed the classification of the GPA deposit under IFRS 15 – Revenue
from Contracts with Customers and IFRS 9 – Financial Instruments, and has concluded that
the deposit is recognized as deferred revenue, reflecting an own-use conclusion. This
assessment considers, among other factors, the own-use exemption and the extended term
of the arrangement, under which gold deliveries continue through year 40 of the
agreement. Management has applied a discount rate of approximately 14% to accrete the
deferred revenue balance over the term of the arrangement. The Company's classification
conclusion, and the resulting accretion and balance sheet presentation, are set out in Note
6 (Deferred Revenue) to the Interim Financial Statements.
Page 5
Valor Gold Corp. - MD&A - Q2 2026
FINANCING ACTIVITIES
Pursuant to the Arrangement, Valor received cash consideration of $5,100,000 from
Seabridge. Other than the Arrangement-related transactions described above, there were
no financing activities during the three and six months ended June 30, 2026.
INVESTING ACTIVITIES
Capitalized mineral property expenditures for the three months ended June 30, 2026,
totaled $556,208 (2025 - $129,403) and six mon

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