Arizona Sonoran Closes C$10.4 Million Private Placement with Hudbay Minerals

On December 12, 2025, Arizona Sonoran Copper Company Inc. ("ASCU") announced the closing of a C$10.4 million non-brokered private placement with strategic investor Hudbay Minerals Inc. ("Hudbay"). Under the placement, ASCU issued 3,111,089 common shares to Hudbay at a price of C$3.35 per share.

The proceeds will be used to fund early development activities and the project debt financing process. Following this and other recent financings, CEO George Ogilvie stated that the company anticipates ending 2025 with a cash balance of just over US$100 million.

This news is materially positive. While the C$10.4 million is a relatively small amount, its significance lies in the context of recent events. This placement represents Hudbay exercising its pre-emptive right to maintain its ownership stake following ASCU's larger C$86.3 million financing that closed on December 2. The continued financial support from a major, established producer like Hudbay provides a strong endorsement of the Cactus Project and management's strategy.

The most critical takeaway is the resulting pro-forma cash position of over US$100 million. For a development-stage company, this is an exceptionally strong treasury that fully funds the company through the upcoming Definitive Feasibility Study (DFS), permitting, and all activities leading to a Final Investment Decision (FID), targeted for Q4 2026. This financial strength allows management to advance early-stage development and engineering work, potentially shortening the overall project timeline and providing significant leverage in future project financing negotiations.

Looking at the progression of news over the past year reveals a systematic and successful de-risking of the project: - Q1-Q2 2025: ASCU advanced technical work for the Pre-Feasibility Study (PFS) and secured a C$21.6 million strategic investment from Hudbay and Nuton (Rio Tinto) at C$1.68/share. - Q2-Q3 2025: The company shored up its balance sheet with a C$51.75 million offering at C$2.00/share, bought down project royalties to improve economics, and completed a critical land acquisition for US$104.5 million (mostly through deferred payments), which it termed a "major derisking event". - Q4 2025: This was a transformational quarter. ASCU released a robust PFS on October 20, outlining a project with a US$2.3 billion NPV and 22.8% IRR. This was followed by a large C$86.3 million financing at C$3.35 in early December, which set the stage for the current Hudbay top-up.

While the financing price of C$3.35 is a significant discount to the current market price of C$4.51, this was expected as it's based on the price of the preceding bought deal and fulfills Hudbay's contractual investor rights. The dilution is a necessary trade-off for securing a large, strategic partner and a war chest that eliminates any near-term financing overhang.

Arizona Sonoran Copper Company Inc. is a Canadian-based copper developer focused on its 100%-owned Cactus Project in a Tier 1 mining jurisdiction in Arizona, USA. The project is a brownfield site on private land with significant existing infrastructure.

The flagship Cactus Project is a large-scale, open-pit porphyry copper deposit. The November 2025 Pre-Feasibility Study (PFS) outlines a 22-year mine life producing high-quality LME Grade A copper cathodes via a heap leach and solvent extraction/electrowinning (SX/EW) process. The PFS projects robust economics, including an after-tax NPV8% of US$2.3 billion, an IRR of 22.8%, and average annual production of 226 million pounds (103,000 tonnes) of copper over the first 10 years, with an initial capital cost of US$977 million.