Mr. Frederick Davidson reports

IMPACT SILVER OUTLINES CAPIRE GOLD OPPORTUNITY AND PLOMOSAS OPERATING AND EXPLORATION UPDATE

Impact Silver Corp. has outlined the planned upgrade and restart of its Capire mill, located 16 kilometres southwest of its current Guadalupe complex operations at Zacualpan. This represents a significant growth initiative, which is expected to potentially increase the company's overall production capacity to almost 700 tonnes per day (tpd), including the nearby legacy Zacualpan Guadalupe mill (500 tpd) that has been in operation for over 20 years.

Capire: a processing opportunity for gold-dominant mineralization

Impact has commenced a program to upgrade the Capire plant to treat underground feed from the Noche Buena complex, consisting of mineral from the Carlos Pacheo, San Juan and San Franciso veins. Due to the better grades of the mill feed from the Noche Buena complex, this program is being given priority over the potential restart of mining in the open pit adjacent to the Capire mill. The recent gold-dominant Carlos Pacheco vein discovery (see Impact news releases dated April 21, 2026, and June 15. 2026) is an important driver of this opportunity. The upgraded Capire circuit would recover gold into precious-metal-rich separate concentrates of copper, lead and zinc providing a treatment route better suited to this mineralization than processing in the Guadalupe mill. Metallurgical work supports this approach, with further testing and engineering focused on enhancing recoveries under operating conditions.

The operation would complement the existing Zacualpan milling activities. Management's plan is to maintain Zacualpan's current operating profitability while directing suitable gold- and copper-bearing material to Capire for treatment through a dedicated circuit. When in operation, Capire would provide an incremental source of revenue and enhance overall company viability.

Current work is focused on optimizing the mine plan and feed availability, refining metallurgy, initiating a capital program to modify the Capire mill and add infrastructure at both the Noche Buena mines and the Capire mill site, negotiating concentrate sales terms, and optimizing mineral transportation costs.

Current planning contemplates the start of processing at Capire to commence in the second half of 2027. Timing remains subject to completion of technical and commercial evaluations and preparations, confirmation of onsite infrastructure and applicable authorizations, capital approval, and execution of the development program.

The company's existing Zacualpan operations remain the central operating priority. Capire is being evaluated as a complementary satellite development opportunity, with mine planning and feed allocation intended to support both operations.

"Capire offers an opportunity to capture more value from the gold-bearing mineralization in our district using some of our existing infrastructure," said Fred Davidson, chief executive officer. "Our objective is to add profitable production at Capire alongside our Zacualpan operations and give our operations flexibility in treating diverse sources of mill feed. With a strong balance sheet and year-to-date generation of positive cash flow, the Capire project will be funded by Impact's working capital."

Plomosas: exploration and feed opportunities

Following the suspension of underground mining announced in March, 2026, Impact evaluated third party feed opportunities to support continued operation of the Plomosas processing plant.

At Sept. 30, 2026, there were no third party feed arrangements in place that could economically support continuing production. Consequently, the company has decided to transition the Plomosas plant to care and maintenance, with activities directed toward maintaining permits and environmental authorizations, safeguarding the tailings facility, and preserving the processing infrastructure, while continuing its exploration program, as well as discussions with potential third party mill feed suppliers.

The extensive exploration program on the Plomosas concessions hopes to identify and delineate additional mineralization that could provide future feed for the plant. The objective is to establish sufficient tonnage, grade and continuity to support evaluation of a sustainable restart of mining and processing operations.

As a result, the company has determined that a non-cash impairment charge of approximately $4.3-million should be recorded in Q3 (third quarter) 2026, reducing the carrying value of the Plomosas property, plant and equipment accordingly. This charge will not impact the company's cash balance. The final impairment amount will be confirmed in the Q3 2026 financial statements.

"At Plomosas," said Fred Davidson, chief executive officer, "we are preserving the facility while advancing exploration and pursuing third party feed opportunities. Future operating commitments will depend on establishing a reliable supply of economic material on acceptable commercial terms."

Qualified person and National Instrument 43-101 disclosure

George Gorzynski, PEng, is a qualified person within the meaning of NI 43-101 and has approved the technical information contained in this news release.

About Impact Silver Corp.

Impact Silver is a successful producer-explorer in Mexico.

Royal Mines of Zacualpan silver-gold mine: Impact owns 100 per cent of over 200 square kilometres of highly prospective ground at Zacualpan in central Mexico, where four producing underground silver mines and one open-pit mine feed the central 500 tpd Guadalupe processing plant. Over the past 20 years, Impact has developed multiple exploration zones into commercial production and has produced approximately 14 million ounces of silver, generating revenue of more than $322-million, with no long-term debt.

To the south, the Capire project includes a 200 tpd processing pilot plant adjacent to an open-pit silver mine, which is being reviewed for a potential restart of operations. An upgrade to the Capire mill is currently under way to process mill feed from the newly developing Noche Buena mine complex. At this time, this will take priority over the advancement of the adjacent Capire open pit. The upgrade of the Capire mill will increase total milling capacity and the capability of handling more diverse mill feed in the Zacualpan district.

Plomosas zinc project: Plomosas is a high-grade zinc project in northern Mexico with exploration upside potential. The company has put the Plomosas plant and mine on care and maintenance while it continues its exploration program and discussions with potential third party mill feed suppliers, and at the same time is assessing arrangements that could support an economically sustainable restart. Exploration potential at Plomosas lies along a long six-kilometre structure. This is in addition to other exploration targets on the 3,019-hectare property, including untested copper-gold targets, with indications of high-grade material at surface. Regionally, Plomosas lies in the same mineral belt as some of the largest carbonate replacement deposits in the world.

We seek Safe Harbor.