Pecoy Copper Announces Closing of Strategic Financing

Pecoy Copper Corp. (PCU) has closed its non-brokered private placement, originally announced on November 2, 2026, issuing 24,676,525 common shares at C$2.02 for aggregate gross proceeds of approximately C$49.8 million. The transaction did not alter the economics previously disclosed. Hudbay Minerals Inc. subscribed for 14,914,100 shares, representing approximately C$30.1 million, while a second, unnamed "Strategic Investor" acquired 9,762,425 shares for approximately C$19.7 million.

Each investor now holds approximately 9.99% of Pecoy Copper Corp.'s issued and outstanding shares on a partially-diluted basis. The C$2.02 issue price reflected a 10% premium to the 10-day volume-weighted average price (VWAP) as of October 30, 2026, implying a VWAP of approximately C$1.84. Concurrent with the closing, Pecoy Copper Corp. executed an investor rights agreement with Hudbay Minerals Inc. This agreement grants Hudbay the right to nominate one director to the board, or two if the board size reaches ten or more members, along with participation and top-up rights to maintain its ownership stake at up to 9.99%.

The company stated that the proceeds will be used for ongoing drilling, resource definition and expansion, geological and metallurgical studies, and technical work supporting a planned updated mineral resource estimate, as well as for general corporate purposes and working capital. Common shares issued in the placement are subject to a statutory hold period expiring four months and one day from November 5, 2026, or on or about March 6, 2027. The placement remains subject to the final acceptance of the TSX Venture Exchange; although closing occurred ahead of final exchange acceptance, a residual administrative condition remains outstanding.

The issuance of 24.68 million new shares against the 209.49 million shares outstanding as of July 31, 2026, results in an 11.8% dilution. Based on cash disclosed in the investor presentation as of October 2, 2026, of C$43 million, and adding the C$49.8 million in gross proceeds, pro-forma liquidity is estimated at approximately C$90 million, prior to approximately five weeks of operating expenditures.

Pecoy Copper Corp. (PCU) has finalized a strategic equity financing, confirming details previously disclosed four days prior. The transaction brings in confirmed capital, activates an investor rights agreement with Hudbay, and establishes fixed timelines for the hold period and TSXV final acceptance. This development addresses the near-term financing risk identified in the company’s Q1 FY2027 MD&A, which included an explicit going-concern flag amid cash burn from a 35,000 m drill program. The deal also provides third-party validation from Hudbay, a strategic operating copper producer in Peru, at a premium to market value.

The stock has declined below the transaction price since the announcement. Shares traded at C$1.82 on 2026-10-30, rose to C$2.00 on 2026-11-02, and closed at C$1.93, C$1.88, and C$1.86 on 2026-11-05. The two strategic buyers paid C$2.02 per share, leaving the current market valuation approximately 8% below that level. A 9.9% holder base with anti-dilution top-up rights remains a structural feature to monitor. Additionally, Hudbay and the Strategic Investor retain rights to participate in future financings and top up to 9.99%, meaning subsequent equity raises will accrue to these holders at the expense of the retail base.

The financing follows a sequence of operational milestones. On 2025-11-17 and 2025-12-16, permits were renewed, community agreements were signed, and the first drill hole since 2016 (PEC25-065) was spudded. A "fully funded" 2026 program was announced on 2026-01-22, targeting up to 40,000 m at Pecoy and approximately 5,000 m at Tororume with five rigs. By 2026-02-19 and 2026-04-08, results from PEC25-065 (1,014 m @ 0.37% Cu) and PEC25-066 (1,020.5 m @ 0.43% Cu) established kilometre-scale continuity below the pit shell.

Further progress included a completed MT survey on 2026-04-22, Phase 1 metallurgy showing 73% Au and 92% Cu recoveries on 2026-05-26, and the reporting of six additional holes, including PEC26-072 (804 m @ 0.34% Cu), on 2026-09-01. By 2026-09-08/09, four rigs had drilled more than 16,000 m of the approximately 35,000 m program, defining the new MTP-01 target. The C$49.8M strategic equity was announced on 2026-11-02/05.

The current program scope is described as approximately 35,000 m, down from the initial "up to 40,000 m" target. While a fifth rig was promised for summer in the 2026-04-08 release, it was still listed as planned on 2026-09-08. No metres at Tororume have been confirmed as drilled. With 16,000 m reported as of 2026-09-01, approximately 19,000 m remains to be drilled in roughly four months, representing a demanding run rate.

Pecoy Copper Corp. (PCU) is a single-district, pre-economic-study copper explorer holding the Pecoy copper-gold-molybdenum-silver project and the adjacent Tororume project. Together, these assets cover approximately 19,800 hectares in the Arequipa region of southern Peru. Neither property currently holds a reserve, a Preliminary Economic Assessment (PEA), a Preliminary Feasibility Study (PFS), or a Feasibility Study (FS).

The flagship Pecoy project contains an NI 43-101 inferred mineral resource effective April 30, 2025, prepared by QP Maria Muñoz of Mining Plus. The estimate was reported within a Whittle pit shell at a 0.23% Cu cut-off, using metal prices of US$3.25/lb Cu, US$8.00/lb Mo, US$1,400/oz Au, and US$20.00/oz Ag. The resource totals 865 Mt at 0.34% Cu, 0.012 g/t Au, 0.36 g/t Ag, and 0.012% Mo, containing 6,451 Mlb (6.5 Blb) of copper.

The estimate is based on 121 historical holes totalling 48,576 m drilled between 2009 and 2016 at approximately 120 m spacing to roughly 400 m depth over an area of ~2.9 km². The data was modeled using ordinary kriging in 15 m × 15 m × 15 m blocks with grade capping. The 2026 exploration program has drilled more than 16,000 m across 16 completed holes, plus additional holes in progress as of September 1, 2026. These efforts are testing the South Breccia, Centre-of-Pit, Central Breccia, and Northwest/MTP-01 areas.

Notable drill intercepts from the current program include:

• PEC25-066: 1,020.5 m @ 0.43% Cu
• PEC26-072: 804.0 m @ 0.34% Cu
• PEC26-067: 209.0 m @ 0.40% Cu from 15 m, including 42.3 m @ 1.01% Cu

All reported widths are downhole lengths; true widths have not been determined in any release.

Logistical conditions at Pecoy are favorable, with the project situated at an elevation of approximately 1,650 m in a semi-arid environment with year-round access. The site is located near highways and the national grid, with the Matarani and Ilo ports within trucking distance.

The Tororume project has no defined resource. The area features a radiometric footprint reportedly three times that of Pecoy. Historical drilling by Pembrook Copper between 2019 and 2023 totaled only 3,933 m. Reported intercepts include toro-007 with 500 m @ 0.30% Cu and toro-008 with 262 m @ 0.27% Cu and 0.028% Mo. The project remains in an early stage.