Latin Metals and Patagonia Gold Agree Terms for Acquisition of Mina Angela Project, Chubut Province, Argentina Total consideration of US$1 million cash and 1% NSR Royalty
LC179157-1
Latin Metals and Patagonia Gold Agree Terms
for Acquisition of Mina Angela Project,
Chubut Province, Argentina
Total consideration of US$1 million cash and 1% NSR Royalty
NR19-09 August 13, 2019
Vancouver, B.C. – Latin Metals Inc. (“Latin Metals ” or the “ Company”) - (TSXV: LMS)
(OTCQB: LMSQF) announces that it has signed an offer letter (the “Offer Letter”) with Patagonia
Gold Corp. (TSXV: PGDC) (“Patagonia”), which provides for a six-month due diligence period for
Patagonia and sets out the proposed commercial terms of a definitive option agreement
(the “Definitive Agreement”) whereby Patagonia will be provided with the option (the “Option”)
to acquire the Company’s interest in the Mina Angela project (“ Mina Angela” or the “Project ”)
located in the Province of Chubut, Argentina. To exercise the Option in full , Patagonia will be
required to make payments to Latin Metals in the aggregate amount of US$1 million cash and
Patagonia will be required to grant to Latin Metals a 1% net smelter returns royalty (“ NSR
Royalty”)1 on any future production from the Pro ject. The Offer Letter was accepted by
Patagonia on August 12, 2019 and Patagonia has made the initial cash payment of US$40,000 to
Latin Metals as contemplated under the Offer Letter (see Table 1 below).
“The proposed sale of Mina Angela is consistent with the Company’s strategy of placing its assets
in the hands of capable partners and allowing Latin Metal’s shareholders retain exposure to the
assets’ future potential,” stated Keith Henderson, Latin Metal’s President & CEO. “Mina Angela
is a former producing mine with significant exploration upside. I believe that the management
team at Patagonia has the ability to finance and execute the exploration necessary to realize that
potential upside and, if they are successful, Latin Metals and its shareholders stand to benefit
from royalty payments on any future production from Mina Angela.”
Commercial Terms
The Offer Letter sets out the expected terms of the Definitive Agreement, whereby Patagonia
can acquire 100% of the Company's interest in the Project, subject to the NSR Royalty in favour
of the Latin Metals as follows:
NR19-09 Continued 2 August 13, 2019
Table 1: Schedule of Proposed Commercial Terms
Schedule of Payments Cash Payments Royalty
Payments
Cumulative
Earned
Interest
Within ten days from acceptance of the Offer
Letter
US$40,000
(paid)2 -- --
Upon signing the Definitive Agreement US$250,000 -- --
Upon exercise of the Option (within six months
of signing the Definitive Agreement) US$250,000 -- 100%
Within 30 days of verification that the legal
restrictions preventing development of mining
activity in the Chubut Province and at the
Project have been lifted (to Patagonia’s
satisfaction)
US$500,000 -- 100%
Commencement of Production at the Project -- 1% NSR
Royalty1 100%
Notes:
1. Patagonia can purchase 50% of the NSR Royalty (0.5%) from the Company at any time for US$1 million cash.
2. Upon receipt of the US$40,000, the Company agreed to deal exclusively with Patagonia in respect of Mina Angela
Upon exercising the Option, Patagonia is expected to take responsibility for keeping the mining
properties comprising Mina Angela in good standing. Latin Metals will be responsible for all
obligations arising or accrued on Mina Angela until Patagonia exercise the Option.
The closing of the acquisition of Mina Angela by Patagonia is subject to certain customary closing
conditions, including the entry into of the Definitive Agreement and receipt of TSX Venture
Exchange (“TSX-V”) acceptance.
About the Mina Angela Property
The Mina Angela property is situated in the Somuncura Massif of southern Argentina and is
comprised of 44 individual claims located approximately 50 km east-southeast of Patagonia’s
100% owned Calcatreu gold project. The Navidad silver and base metal deposit is located 45 km
further to the south-southeast of Mina Angela. Cardero Argentina S.A., Latin Metal’s wholly-
owned subsidiary, is currently the 100% owner of the mineral claims comprising the Project,
subject to a 1% NSR from future production on Mina Angela
About Patagonia Gold
Patagonia Gold Corp. is a TSX Venture Exchange listed company that seeks to grow shareholder
value through exploration and development of gold and silver projects in the Patagonia region of
Argentina. The Company is primarily focused on the Calcatreu project in Rio Negro and the
development of the Cap Oeste underground project. Patagonia, indirectly through its
subsidiaries or under option agreements, has mineral rights to over 350 properties in several
provinces of Argentina, Chile and Uruguay and is one of the largest landholders in the province
of Santa Cruz, Argentina
NR19-09 Continued 3 August 13, 2019
About Latin Metals
Latin Metals is a mineral exploration company acquiring a diversified portfolio of assets in South
America. The Company operates with a Prospect Generator model focusing on the acquisition
of prospective exploration properties at minimum cost, completing initial evaluation through
cost-effective exploration to establish drill targets, and ultimately securing joint venture partners
to fund drilling and advanced exploration. Shareholders are exposed to the upside of a significant
discovery without the dilution associated with funding the highest-risk drill-based exploration.
Among the Company’s asset portfolio, key assets include the Organullo Gold project; a 100%-
owned property in which Yamana Gold Inc. are earning an initial 70% interest through various
work commitments and cash payments.
Qualified Person
Keith J. Henderson, P.Geo., is the Company's qualified person as defined by NI 43-101 and has
reviewed the scientific and technical information that forms the basis for portions of this news
release. He has approved the disclosure herein. Mr. Henderson is not independent of the
Company, as he is an employee of the Company and holds securities of the Company.
On Behalf of the Board of Directors of
LATIN METALS INC.
“Keith Henderson”
President & CEO
For further details on the Company readers are referred to the Company's web site (www.latin-
metals.com) and its Canadian regulatory filings on SEDAR at www.sedar.com.
For further information, please contact:
Keith Henderson
Suite 2300
1177 West Hastings Street
Vancouver, BC, V6E 2K3
Phone: 604-638-3456
E-mail: [email protected]
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of this news release.
Cautionary Note Regarding Forward-Looking Statements
This news release contains forward-looking statements and forward-looking information (collectively, "forward-
looking statements") within the meaning of applicable Canadian and U.S. securities legislation, including the United
States Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact,
included herein including, without limitation, statements regarding the negotiation and commercial terms of the
Definitive Agreement and exercise of the Option, the anticipated content, commencement, timing and cost of
exploration programs in respect of Mina Angela and otherwise, anticipated exploration program results from
exploration activities, and the Company's expectation that it will be able to operate as a Prospect Generator by
entering into agreements to acquire interests in additional mineral properties and attracting joint venture partners
NR19-09 Continued 4 August 13, 2019
to fund drilling and conduct advanced exploration on its properties, the discovery and delineation of mineral
deposits/resources/reserves on Mina Angela, the anticipated results from exploration activities and the anticipated
business plans and timing of future activities of the Company, are forward-looking statements. Although the
Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to
be correct. Forward -looking statements are typically identified by words such as: "believes", "will", "expects",
"anticipates", "intends", "estimates", "plans", "may", "should", "potential", "scheduled", or variations of such words
and phrases and similar expressions, which, by their nature, refer to future events or results that may, could, would,
might or will occur or be taken or achieved. In making the forward-looking statements in this news release, the
Company has applied several material assumptions, including without limitation, that it will be able to negotiate the
Definitive Agreement and that it will obtain TSX-V acceptance for filing of thereof, market fundamentals will result
in sustained precious metals demand and prices, the receipt of any necessary permits, licenses and regulatory
approvals in connection with the future development of the Company’s Argentine projects in a timely manner,
including the lifting of restrictions preventing the development of mining activities at Mina Angela, the availability of
financing on suitable terms for the development, construction and continued operation of the Company's projects,
and the Company’s ability to comply with environmental, health and safety laws.
Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of the Company to differ materially from any future results, performance
or achievements expressed or implied by the forward-looking statements. Such risks and other factors include,
among others, actual results of exploration activities, the fact that the Company's granting of the Option to Patagonia
is an option only and there is no guarantee that the Option will be exercised by Patagonia or that Patagonia will be
satisfied with the lifting of the mining restrictions in the Chubut Province such that it makes the final payment to the
Company, the inability of the Company to operate as a Prospect Generator and enter into agreements to acquire
interests in additional mineral properties and attract joint venture partners for the exploration and development of
same, operating and technical difficulties in connection with mineral exploration and development and mine
development activities at the Company's mineral properties, the fact that the Company's interests in certain of its
mineral properties are only options and there is no guarantee that the interests, if earned, will be certain,
requirements for additional capital, future prices of precious metals, copper-gold and lithium, changes in general
economic conditions, changes in the financial markets and in the demand and market price for commodities, other
risks of the mining industry, the inability to obtain any necessary governmental and regulatory approvals (including
TSX-V acceptance for filing of the Definitive Agreement, any current or future property acquisitions or dispositions),
financing or other planned activities, changes in laws, regulations and policies affecting mining operations, hedging
practices and currency fluctuations, title disputes or claims limitations on insurance coverage and the timing and
possible outcome of pending litigation, environmental issues and liabilities, risks related to joint venture operations,
and risks related to the integration of acquisitions, as well as those factors discussed under the heading "Risks and
Uncertainties" in the Company's most recent management's discussion and analysis and other filings of the Company
with the Canadian Securities Authorities, copies of which can be found under the Company's profile on the SEDAR
website at www.sedar.com.
Readers are cautioned not to place undue reliance on forward-looking statements. Except as otherwise required by
law, the Company undertakes no obligation to update any of the forward-looking information in this news release or
incorporated by reference herein.
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