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Largo Resources To Raise Up To C$50 Million

|Includes: Largo Resources Ltd. (LGORF)

Largo Resources (CVE:LGO) (OTCMKTS:LGORF) will raise up to C$50 million through a private placement at an issue price of C$0.80 per Unit.

A unit includes one common share and one-half of one common share purchase warrant. Holders of warrants will be able to exercise them for price of C$1.50 for a period of 12 months following the close of the deal.

Largo has also granted the Agent, Mackie Research, an option to increase the size of the offering by up to 15% in units, until 48 hours prior to the closing.

Largo noted that it expects many current shareholders to take part in the offering, which is conditional upon the company raising at least US$35 million in equity as part of a restructuring of its debt facilities for the Maracas Menchen Mine with its commercial consortium of lenders.

Largo will use the net proceeds from the deal, which is expected to close during the week of May 15, 2015, to continue development of the Maracas Menchen Mine and for general corporate purposes.

Separately, Largo has received confirmation from its lenders consortium for the restructuring of debt facilities for the Maracas Menchen Mine.

On April 30, Largo said it signed a term sheet with lenders to defer its debt amortization schedule in a restructuring package that has also extended the maturities of its construction debt and export credit facilities for its Maracas Menchen Mine.

The restructuring allows for an additional one-year grace period on the amortization repayment schedules for the Facilities, a two-year extension of maturity for its export credit facilities and a three-year extension of maturity for the BNDES Loan for the US dollar component.

The lenders have also agreed to extend the deferral of the beginning of the amortization of the export credit facilities from April 2016 to October 2016.

Last March, Largo closed a C$12 million convertible bridge loan as the vanadium miner said it would have to raise more equity capital to address additional capital expenses for 2015, including the improvement of recoveries of the leaching system at Maracas Menchen.

The successful effort to restructure debt and increase available resources add to the encouraging performance at the Mine, which Largo is aiming to develop to phase 1 capacity by the third quarter.

The mine started production last August. The Toronto-based miner is expecting 2015 production to come in at 17 million pounds of vanadium pentoxide at very competitive costs.

Looking ahead to 2016, the company has the option to complete a $32 million expansion, which would raise capacity by some 50 percent and make Maracas the largest and lowest cost vanadium mine in production.

Largo started producing vanadium ore in March of 2014 and shipments began in early September. It is the first vanadium project in the Americas and its target is to reach 11,700 tons at full capacity.

Largo's deposit is considered to be the highest grade vanadium deposit in the world with grades of 1.3% - twice as high as the majority of known vanadium deposits because if its low silica content, which makes it easier and cheaper to process. Vanadium is becoming essential for the production of steel as aircraft and automotive manufacturers address demand for lighter and tougher materials, which contribute to reducing fuel consumption and reduce emissions.