Mr. Richard King reports

PEPCAP ENTERS INTO SHARES FOR DEBT SETTLEMENT

Pepcap Resources Inc. has arranged a series of private debt assignments and a related shares-for-debt transaction involving the settlement of debt owed by the company.

Three creditors of the company, Tim Man-Tin Ng, Sophie Tran and Tek Sian Kwan, entered into separate assignment agreements with Clark Swanson, under which they transferred their respective claims against the company to Mr. Swanson. The assigned debts arose from services rendered and monetary advances previously made to the company and collectively totalled $389,960.

Following the completion of the above assignments, Mr. Swanson entered into a further assignment agreement, under which he assigned the full aggregate amount of $389,960 to Franziska Von Fischer. Under this final assignment, Ms. Von Fischer acquired all of Mr. Swanson's rights, title and interest in the assigned debt, including any rights of action, free of any liens or encumbrances.

In final settlement of the full $389,960 debt owed to Ms. Von Fischer, Pepcap entered into a shares-for-debt agreement dated July 8, 2025. Pursuant to the agreement, the company shall issue 38,996,000 common shares at a deemed price of one cent per share, in full and final satisfaction of the amount owing. The transaction, which constitutes a change of control under the policies of the TSX Venture Exchange, remains subject to TSX-V acceptance, and, to the extent required, disinterested shareholder approval of the transaction in the event the issuance results in the creation of a new control person.

As an update to the company's news release of May 22, 2025, announcing preliminary negotiations with Blockmetrix LLC, the company is continuing its due diligence review and no agreement has been entered into yet.