Option Terms
Daura will be granted the option (the "Option") to earn a 75% undivided interest in the Properties for a period (the "Option Period") of 38 months from the date of execution and delivery (the "Effective Date") of the Letter Agreement.
To exercise the Option, Daura must make aggregate payments of US $1,700,000 to Latin Metals, assume payments of US $400,000 to the Underlying Vendor (as defined below), complete exploration work commitments, and prepare and deliver to Latin Metals a report prepared in accordance with Form 43-101F1 on the Properties (the "Technical Report"), addressed to Latin Metals and containing a mineral resource estimate on the Properties.
Irrevocable work commitments to be completed on or before April 30, 2026, are 50-line km of IP profiling, 150-line km of gradient array IP, and 1,500 meters of drilling. A total of 28,000m of drilling must be completed prior to the exercise of the Option.
Keith Henderson, CEO of Latin Metals Inc., stated:
"Partnering with Daura Gold on the Cerro Bayo and La Flora projects demonstrates the continued success of our prospect generator model. Daura brings both financial strength and a strong technical team, enabling meaningful exploration in one of Argentina's most prolific precious metal belts. This agreement ensures our shareholders retain exposure to potential discovery while minimizing dilution."
Mark Sumner, President of Daura Gold Corp., commented:
"Cerro Bayo and La Flora strengthen Daura Gold's existing Peruvian portfolio with these properties in the Deseado Massif, one of the most productive precious-metal belts in the world. Through our agreement with Latin Metals, we're well-positioned to rapidly advance drill-ready targets and unlock the projects' full potential."
The Properties are currently subject to an underlying purchase agreement (as amended, the "Underlying Agreement") (see news release dated June 25, 2025) between Latin Metals and Tres Cerros Exploraciones S.R.L. (the "Underlying Vendor"). The Underlying Vendor retains a 0.75% NSR royalty, 0.5% can be purchased for US $1,000,000, which cost will be assumed by Daura.
Top Up Right
Concurrently with the exercise of the Option, Daura may give notice to Latin Metals of its intention to increase its interest in the Properties to 80% (the "Top-Up Right"). To exercise the Top-Up Right, Daura must make cash payments to Latin Metals based on the measured, indicated and inferred mineral resources included in the mineral resource estimate set out in the Technical Report, as follows:
(i) US$7.00 per gold equivalent ounce of measured and indicated resources; and(ii) US$5.00 per gold equivalent ounce of inferred resources,
Table 1: Option Terms
Payment to Latin Metals (USD)
Assumed Payment to Underlying Vendor (USD)
Drilling (m)
Within 3 Days of Effective Date
$200,000(1)(2)
$100,000(1)(3)
-
On or before April 30, 2026
$100,000
$150,000(1)(4)
1,500(1)
On or before December 31, 2026
