Latin Metals signs agreement for spinout

Executive Summary

• Latin Metals Inc. has entered into an arrangement agreement to spin out its Para and Auquis copper projects in Peru into a new wholly-owned subsidiary, Latin Explore Inc.
• The transaction involves a statutory plan of arrangement under the British Columbia Business Corporations Act, distributing approximately 10,944,000 common shares of Latin Explore to Latin Metals shareholders.
• Latin Explore will operate as a self-financed, discovery-driven exploration company, while Latin Metals continues its prospect generator model; the spin-out aims to provide parallel value-creation opportunities and minimize shareholder dilution.

Key Details

• Transaction Structure: Statutory plan of arrangement under the BC Business Corporations Act.
• Share Distribution: Approximately 10,944,000 common shares of Latin Explore to be distributed to Latin Metals shareholders (excluding dissenting shareholders) on a pro-rata basis.
• Post-Transaction Ownership:
  • Latin Metals shareholders: ~28.3%
  • Latin Metals (retained): ~7.1%
  • Finco shareholders: ~64.6%
• Finco Private Placement: Prior to the arrangement, Latin Explore will complete a share exchange with Finco, a private BC company. Finco completed a non-brokered private placement of 25 million subscription receipts for aggregate gross proceeds of $2.5 million at $0.10 per receipt.
• Finco Warrant Terms: Each Finco unit consists of one common share and 0.5 common share purchase warrants. Warrants are exercisable into one Finco share at $0.20 per share for 24 months.
• Finder’s Fees: Finco may pay cash commissions of up to 7% of gross proceeds and non-transferable finders' warrants equal to up to 7% of subscription receipts. Finders' warrants are exercisable at $0.10 per share for 12 months.
• Escrow and Use of Proceeds: Gross proceeds held in escrow; released to Finco upon satisfaction of conditions. Net proceeds used for Latin Explore’s work programs and general working capital. If conditions are not met within 180 days (plus 30-day extension), proceeds returned pro-rata.
• Listing Intent: Latin Explore intends to apply for listing on the TSX Venture Exchange and will be a reporting issuer in BC and Alberta.
• Share Exchange Mechanics: Upon closing, each Finco share exchanges for one Latin Explore share. Finco and finder’s warrants entitle holders to receive one Latin Explore share on established schedules.
• Governance and Approval:
  • Special committee of independent directors unanimously recommended approval.
  • Evans & Evans Inc. provided a verbal fairness opinion.
  • Shareholder vote scheduled for Jan. 14, 2026, via special meeting.
  • Management information circular expected mid-December 2025.
• Conditions Precedent: Approval by two-thirds of votes cast, majority of votes excluding interested persons, TSX-V corporate finance policy approval, and Supreme Court of BC approval.
• Para Project Details: 100% owned; acquired via staking (2023) and additional property acquisition (2025). Leveraging historical data from Vale Exploration Peru S.A.C. (geochemical sampling, IP, magnetic/radiometric surveys). Four drill targets identified. SLR Consulting retained for NI 43-101 technical report.
• Auquis Project Details: Potential for copper-molybdenum porphyry and skarn deposits. Surface discoveries include Rose zone (magnetic anomalies/copper mineralization) and Blanco zone (magnetic anomalies/skarn alteration/base metals).
• Qualified Person: Eduardo Leon (officer of the company, not independent).

Notable Quotes

• "Latin Explore unlocks an entirely new category of opportunities for Latin Metals shareholders, who will now gain exposure to new acquisition opportunities within the spinout, as well as early drill testing of foundational assets like Para," stated Keith Henderson, chief executive officer of Latin Metals.
• "Latin Metals will continue to operate under its prospect generator model and we look forward to delivering drill catalysts -- including at Cerro Bayo in early 2026. As shareholders of the new vehicle, Latin Explore, investors will benefit from direct exposure to drill projects and acquisition opportunities as we grow and advance this parallel operating strategy."