Max Resource Announces Closing of Transaction to Purchase 100% of the Florália Hematite Iron Ore Project in Brazil
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Max Resource Announces Closing of Transaction to Purchase 100% of the
Florália Hematite Iron Ore Project in Brazil
Vancouver B.C., October 11, 2024 – MAX RESOURCE CORP. (“Max” or the “Company”) (TSX.V: MAX; OTC: MXROF; Frankfurt:
M1D2) is pleased to announce that, further to its news releases o n May 16, June 17, August 6, and August 19 2024, it has
closed the transaction to purchase a 100% interest in Mineral Right n° 832.022/2018, which represents the Florália Hematite
Iron Ore Project (“Florália Hematite or Florália”) located 70-km east of the city Belo Horizonte, State of Minas Gerais, Brazil
(the “Transaction”).
The Transaction closed pursuant to a mineral right purchase agreement (the “APA”) entered into with the Company’s wholly
owned Brazilian subsidiary, Max Resource Brazil Ltd. (“Max Brazil” and, together with the Company, the “Max Entities”), Jaguar
Mining Inc. (“Jaguar”) (TSX: JAG) and Jaguar’s wholly owned Brazilian subsidiary, Mineração Serras Do Oeste Limitada (together
with Jaguar, the “Jaguar Entities”). The transfer of the Florália Hematite Project to Max Brazil was lodged at the Brazilian
National Mining Agency (“ANM”) on September 5, 2024.
“The Florália Hematite Iron Ore open pit reveals sizable, sub- horizonal plunging bands of hematite iron ore which appear to
extend in all directions. Upon successful exploration and development, with iron ore buyers situated within 20-km, Florália would
have a significant transportation cost advantage, as bulk tonnage haulage to a shipping port would not be required," commented
Max CEO, Brett Matich.
“Our Brazilian exploration team has commenced the 2024 program, starting with a drone magnetic survey, channel sampling of
roads cutting through the mineralization, and subsequent auger and diamond drilling. I look forward to updating shareholders
in the coming weeks,” he concluded.
Figure 1. Iron Ore Buyers within 20-km Radius of the Florália Hematite Iron Ore Project.
The Florália Hematite Project is centrally located within a prolific iron ore mining region in Minas Gerais, Brazil’s largest iron
ore producing State. Numerous iron ore buyers lie within 20-km of Florália, providing a local ready market requiring minimal
transportation, upon successful exploration and development (Refer to Figure 1).
In 2023, Jaguar Mining (TSX: JAG) conducted a program consisting of 41 channel samples collected over a 151m accumulated
length. This resulted in the definition of a geological target estimated at 2,971,233 m3 to 4,496,333 m3 or 8,052,041 tons to
12,184,160 tons using a density of 2.71 g/cm3 at an average grade of 58% Fe* (Pre-Dry Screening) (Refer to Figure 2).
*The source of the exploration information on the Florália Property is “Depósito Florália Oportunidade para minerrio de ferro by Jaguar Mining Inc.” The document is
undated. Max cautions investors the potential quantity and grade of the iron ore is conceptual in nature, and further cautions there has been insufficient exploration
to define a mineral resource and Max is uncertain if further exploration will result in the target being delineated as a mineral resource.
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Figure 2. Florália Geochemistry and Channel Sampling.
The Florália Hematite open cut is of significant size consisting of five benches rising to 48m and 160m in width revealing
plunging bands of hematite iron ore at the base, and sub-horizontal banding at the top of the open cut and is open in all
directions.
2024 Florália Exploration Program
The objective is to outline the sub-horizontal footprint and estimated thickness of the mineralization extending beyond the
current geological target of 8 to 12mt at 58% Fe* (pre-dry screening):
• Hi-Res Drone Magnetic and LiDAR survey, 140-line-km/50m spacing (underway).
• Channel sampling (~15m) across roads cutting through the hematite iron ore mineralization (underway).
• Bulk sample for metallurgical test work (underway).
• Commencement of a feasibility study (underway).
• Infill auger drilling.
• Diamond drilling.
Florália Purchase Transaction
In consideration for the acquisition of the Florália Hematite Project, Max made cash payments of US$300,000 to the Jaguar
Entities. Additionally, Max will make following remaining cash payments:
• US$200,000 within five business following the date six months after the effective date of the APA; and
• US$200,000 within five business following the date 12 months after the effective date of the APA.
• US$300,000 within five business following the approval of the Florália mineral right transfer to Max Brazil by
the ANM.
In connection with the Transaction, the Max Entities and Jaguar Entities entered into a net smelter returns royalty agreement,
pursuant to which the Max Entities granted to the Jaguar Entities a production royalty equal to 3.5% of the net smelter returns
from the Florália Hematite Project. The Royalty shall be calculated and paid at the end of every calendar quarter following the
first sale of any minerals and mineral-by products produced or extracted by the Max Entities from the Florália Hematite Project.
The Jaguar Entities and Max Entities are arm’s length parties and, as a result of the Transaction, no new insiders or control
persons of the Company were created. No finder’s fees or commissions were paid in connection with the Transaction.
The original term of Mineral Right n° 832.022/2018 has expired but a partial exploration report and request for a three-year
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extension has been submitted to the ANM. All exploration works may continue while the exploration report is under analysis
by the ANM.
Performance Share Units
The Company also announces that it has granted 4,000,000 Performance Share Units (“PSUs”) to certain directors and officers
of the Company pursuant to the Company’s omnibus equity incentive compensation plan (the “Omnibus Plan”). The PSUs are
intended to incentivize the board and management of the Company as the Company develops the Florália Hematite Project.
The PSUs will vest upon the Company achieving performance milestones and align the board and management’s compensation
with the success of the Company. The PSUs will be subject to vesting upon the achievement of permitting, completion of a
significant phase 1 drill program and the reporting of results to the public.
In addition, the Company has granted a further 2,285,000 PSUs with additional performance criteria for vesting being the
recommendation of a further drill program based upon the success of the phase 1 drill program. The additional PSUs are
subject to approval of the Company shareholders who will be asked to ratify the increase in the fixed number of PSUs under
the Omnibus Plan and the additional grant of PSUs under the Omnibus Plan. The Company will recommend in favor of the
increase in the number of PSUs and the specific grants as the vesting criteria for the PSUs properly compensate the board and
management only if the Company’s Florália project in Brazil is developed. All PSUs will lapse, if the performance milestones
are not achieved, within 36 months from the grant date.
About Max Resource Corp.
Max Resource Corp. (TSXV: MAX) is a mineral exploration company advancing the newly discovered district-scale wholly owned
Sierra Azul Copper-Silver Project in Colombia and its wholly owned Florália Hematite Iron Ore Project in Brazil.
The Sierra Azul Project sits along the Colombian portion of the world’s largest producing copper belt (Andean belt), with world-
class infrastructure and the presence of global majors (Glencore and Chevron). Max has an Earn -In Agreement (“EIA”) with
Freeport-McMoRan Exploration Corporation (“Freeport”), a wholly owned affiliate of Freeport-McMoRan Inc. (“NYSE: FCX”)
relating to the Sierra Azul Project. Under the terms of the EIA, Freeport has been granted a two-stage option to acquire up to
an 80% ownership interest in the Sierra Azul Project by funding cumulative expenditures of C$50 million and making cash
payments to Max of C$1.55 million. Max is the operator of the initial stage. The USD $4.2 million 2024 exploration program
for the Sierra Azul Project is funded by Freeport.
The Florália Hematite Iron Ore Project is located 70km SE of Belo Horizonte, Minas Gerais, Brazil’s largest iron ore producing
State. Numerous iron ore buyers lie within 20-km of Florália, providing a local ready market requiring minimal transportation,
upon successful exploration and development . The 2024 exploration objective is to outline the sub -horizontal footprint and
estimated thickness of the mineralization extending beyond the 2023 estimated geological target of 8 to 12mt at 58% Fe* (pre-
dry screening). The program consists of high -resolution drone Magnetic/LiDAR survey (140 -line-km, 50m spacing), channel
sampling, comment of the feasibility study, auger and diamond drilling.
*The source of the exploration information on the Florália Property is “Depósito Florália Oportunidade para minerrio de ferro by Jaguar Mining Inc.” The document is
undated. Max cautions investors the potential quantity and grade of the iron ore is conceptual in nature, and further cautions there has been insufficient exploration
to define a mineral resource and Max is uncertain if further exploration will result in the target being delineated as a mineral resource.
For more information visit: https://www.maxresource.com/.
For additional information contact:
Tim McNulty E: [email protected] T: (604) 290-8100
Rahim Lakha E. [email protected]
Brett Matich T: (604) 484 1230
Qualified Person
The Company's disclosure of a technical or scientific nature in this news release was reviewed and approved by Tim
Henneberry, P.Geo (British Columbia), a member of the Max Resource advisory board, who serves as a qualified person under
the definition of National Instrument 43-101.
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 release.
This news release contains certain "forward- looking information" within the meaning of applicable securities law. Forward- looking information is frequently
characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or
conditions "may" or "will" occur. Forward- looking statements are based on the opinions and estimates at the date the statements are made and are subject to a
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variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward- looking
statements including, but not limited to the remaining cash payments pursuant to the APA , the achievement of performance milestones of the PSUs and the
development of the Florália Hematite Project. There are uncertainties inherent in forward-looking information, including factors beyond the Company’s control. There
are no assurances that the commercialization plans for Max Resources Corp. described in this news release will come into effect on the terms or time frame described
herein.
The Company undertakes no obligation to update forward- looking information if circumstances or management's estimates or opinions should change except as
required by law. The reader is cautioned not to place undue reliance on forward- looking statements. Additional information identifying risks and uncertainties that
could affect financial results is contained in the Company’s filings with Canadian securities regulators, which filings are available at www.sedarplus.ca.