Kodiak Copper Updates on Progress of Previously Announced Transaction to Create New US-Focused Copper Exploration Company

Executive Summary

• Kodiak Copper Corp. provides a progress update on its proposed transaction with Teck Resources Limited and Kay Copper Corp. to combine their respective Arizona copper projects (Mohave and Copper Hill) into a new US-focused exploration company, Kay Copper, expected to list on the TSXV in Q3 2026.
• The transaction structure includes a completed non-brokered initial financing of $830,000 and a planned concurrent subscription receipt financing of at least C$4.0 million to fund exploration programs, with proceeds held in escrow until closing conditions are met.
• Post-transaction capitalization is expected to total ~70.3 million shares, with Kodiak and Teck each retaining ~28% ownership, alongside existing Kay Copper shareholders and financing subscribers.

Key Details

• Transaction Structure: Kodiak will vend 100% of the Mohave project and Teck will vend 100% of the Copper Hill project (both in Arizona) into a subsidiary of Kay Copper to form a new US-focused copper exploration company.
• Closing Timeline: Expected to close in Q3 2026, subject to definitive agreements, due diligence, consents, regulatory/TSXV approval, and completion of the NewCo Concurrent Financing.
• NewCo Initial Financing: Completed non-brokered financing at $0.10 per share for gross proceeds of $830,000 to a broad group of investors, intended to meet TSXV listing distribution requirements.
• NewCo Concurrent Financing: Intended subscription receipt financing at $0.25 per share for minimum gross proceeds of C$4.0 million. Proceeds will be held in escrow and released concurrently with closing upon satisfaction of specified conditions. Funds are designated to advance exploration work programs for both projects in 2026.
• Consideration: NewCo will issue 20 million common shares at a deemed price of $0.25 per share to Kodiak for Mohave, and 20 million common shares at $0.25 per share to Teck for Copper Hill.
• Corporate Steps: NewCo will complete a three-cornered amalgamation with Kay Copper; Kay Copper will apply for TSXV listing under the name Kay Copper Corp.
• Expected Capital Structure: ~70,300,000 common shares outstanding post-transaction. Ownership breakdown: Kodiak 28%, Teck 28%, Kay Copper existing shareholders 9%, NewCo Initial Financing subscribers 12%, NewCo Concurrent Financing subscribers 23%.
• Management Appointments: Mark Osterberg to join as VP Exploration on closing, based in Arizona, to lead exploration programs at Mohave and Copper Hill. Other management and board appointments are being finalized.
• Additional Terms: Teck and Kodiak are expected to enter separate Investor Rights Agreements. Teck will be granted off-take rights for certain concentrate production from the Mohave and Copper Hill projects.

Notable Quotes

• Claudia Tornquist, President and CEO of Kodiak: "I am pleased to report that the previously announced transaction to create Kay Copper, a US-focused copper exploration company, is progressing well and important milestones have been achieved, particularly the closing of the NewCo Initial Financing. Mark Osterberg, an accomplished geologist with extensive copper porphyry experience, has agreed to join Kay Copper as VP Exploration, based in Arizona, and lead the Company's exploration programs at the Mohave and Copper Hill projects. This is a key appointment for the Company, and we are glad to have found such an excellent candidate to strengthen our technical leadership team. I have no doubt that this transaction represents the best path to unlock the value of Kodiak's non-core Mohave project and will generate compelling returns for our shareholders."