Mogotes to Pay $13M, Half in Stock, to Clear Filo Sur Royalty Pre-Resource

• Mogotes Metals has signed a binding offer to acquire GRG Resources' 1.5% net smelter returns (NSR) royalty on its Filo Sur copper-gold project for $13 million. The project has not yet defined any mineral resources.
• GRG will pay half the price in cash and half in Mogotes common shares, priced at the 20-day volume-weighted average trading price on the TSX Venture Exchange (TSXV) when the definitive agreement is signed.
• The consideration shares carry a statutory hold of 4 months plus 1 day, so GRG takes on Mogotes equity exposure alongside its cash.
• Filo Sur produced 2 discoveries in the 2025-2026 season, including 180 meters at 0.98% copper equivalent at Albor, and Mogotes is planning up to 20,000 meters of drilling for 2026-2027.
• The companies are targeting completion by December 29, 2026, subject to a definitive agreement and TSXV approval.

Mogotes Metals Inc. (TSXV: MOG | FSE: OY4 | OTCQB: MOGMF) has signed a binding offer to acquire the 1.5% net smelter returns (NSR) royalty on its flagship Filo Sur copper-gold project from GRG Resources Corp. for $13 million. Filo Sur, on the Argentina-Chile border in the Vicuña district, is at the discovery, pre-resource stage. The company is removing a claim on the project's future revenue before drilling has sized that revenue.

Deal Terms & Conditions to Close

The offer is binding, but the transaction still has to be documented and approved. A Mogotes subsidiary will acquire the NSR royalty for $6.5 million in cash and $6.5 million in Mogotes common shares. The shares will be priced at the 20-day volume-weighted average trading price on the TSX Venture Exchange (TSXV) as of the date the parties sign a definitive agreement. They will be listed on issue and are subject to a statutory hold of 4 months plus 1 day.

The number of shares GRG receives is not yet fixed: it will follow Mogotes' trading price over the 20 days to signing. Mogotes had 609 million common shares outstanding as at September 16, 2026.

Closing also requires regulatory and TSXV approvals, required contractual consents, and required notices. The companies are targeting completion by December 29, 2026.

Deal-Making & Filo Sur Priority

Mogotes has assembled its 3-project portfolio through option structures, and management treats execution speed as part of the method. Mogotes Metals Chief Executive Officer Allen Sabet has described how the company approaches acquisitions.

"That's what entrepreneurs do: you find an opportunity that no one else has really seen, which means you've got to think differently. If you're thinking differently, you're already putting yourself aside from the other 90% of people, so now you're competing against 10%, those who have independent thinking, strong technical backgrounds or strong technical teams, and are open. Then you have to hit the opportunity window: the opportunity has to present itself to you at the same time as you have the capital and the time to take advantage of it, and then you need to be the fastest person to make the offer in that brief opportunity window. So it's not luck."

Filo Sur takes priority on funding, with drilling running from approximately November to May. Sabet has also tied Filo Sur to the company's relationship with Rio Tinto at the Copper Cliff project in Montana:

"Of course, the backdrop to all of this is that we have a 15-month exclusivity with Rio Tinto at the project level on Filo Sur. It's almost entirely the same team, the Americas team. What happens at Filo Sur will also be interesting in relation to this: if we find something exciting in Montana and also find something exciting at Filo Sur, then another set of possibilities opens up."

Mogotes' exploration timeline has Rio Tinto's exclusivity expiring in November 2027, after the 2026-2027 Filo Sur season.

Filo Sur in the Vicuña District

The royalty covers ground on the same belt as Filo del Sol. The project adjoins the southern limit of the Filo del Sol resource. Filo Corp, which held Filo del Sol, was acquired by BHP and Lundin Mining for C$4.5 billion. Filo Sur lies on a north-south trending Middle Miocene belt that shares similar-age rocks, 14 to 16 million years old, with Filo del Sol and NGEx Minerals' Lunahuasi deposit. Mogotes cautions that mineralization on adjacent properties is not necessarily indicative of mineralization at Filo Sur.

The 2025-2026 season produced 2 discoveries on the Macho Muerto Fault Zone. At Albor, a single hole returned 180 meters at 0.98% copper equivalent from 108 meters, including 58 meters at 1.77% copper equivalent from 111 meters, the highest-grade intercept at Filo Sur to date. Cruz del Sur, a gold-copper porphyry open in all directions, returned 308 meters at 0.46% copper equivalent and 334 meters at 0.45% copper equivalent in one hole, over 640 meters of mineralization. The fault zone runs about 10 kilometers through the project and is mostly undrilled.

The Trade-Off in Buying Out the Royalty Now

The next season will test whether those discoveries extend. Mogotes is planning up to 20,000 meters of drilling in 2026-2027, a program the company says more than triples its drilling, covering extensions at the Albor breccia, expansion of Cruz del Sur, a first porphyry test at Luz del Sol-Cuenca, completion of testing at Meseta, and reconnaissance along the full fault zone. The program is at the planning stage and subject to permitting, budgets, and results from earlier holes. The company reported C$77 million in cash and equivalents as at September 21, 2026.

Mogotes is committing $13 million in cash and shares before drilling has established the economic value of Albor or Cruz del Sur. If the 2026-2027 program advances those discoveries toward a first resource, the company will hold Filo Sur's future revenue free of the 1.5% NSR royalty. If results fall short, the purchase cost is already committed.

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