Largo signs binding term sheet with Brazilian banks

Executive Summary

• Largo Inc. and its subsidiary LVMSA have secured an executed binding term sheet from five Brazilian lenders for US$84.2 million of debt, allowing principal repayments to be deferred until March 18 2026 (with automatic rollover to September 18 2026).
• The deferral is conditioned on Largo obtaining at least CAD 30 million in new capital by November 17 2025; 80 % of any excess capital will be used for principal repayment.
• LVMSA will provide a negative pledge over its mining assets, continue quarterly interest payments, submit unaudited quarterly balance sheets, and renegotiate supplier debts.

Key Details

• Term Sheet Amount: US$84.2 million representing the outstanding debt of LVMSA.
• Deferral Schedule: Principal repayments postponed to 18 Mar 2026; automatic rollover to 18 Sep 2026 if conditions are met.
• Capital Condition: Largo must secure a minimum of CAD 30 million by 17 Nov 2025.
• Use of Secured Capital: Up to 80 % of any capital raised above the CAD 30 million threshold will be applied toward principal repayment to the lenders.
• Negative Pledge: LVMSA will place a negative pledge over its mining rights and equipment as security for the lenders.
• Interest Payments: All accrued interest must be paid; future interest will be paid on a quarterly basis.
• Principal Repayment from Proceeds: $2 million of principal to be repaid using proceeds from the secured capital.
• Reporting Requirements: LVMSA must submit its unaudited quarterly balance sheets to the banks.
• Supplier Debt Renegotiation: LVMSA will renegotiate existing debts with suppliers as part of the restructuring plan.

Notable Quotes

“We want to thank the five Brazilian lenders for their support with the signing of a binding term sheet for a deferral of principal payments. With a deferral of principal payments, Largo would have a longer runway to restructure its bank debt.” – Daniel Tellechea, Interim CEO, Largo Inc.