Mr. Keith Henderson reports

LATIN METALS ANNOUNCES EXECUTION OF ARRANGEMENT AGREEMENT FOR SPIN-OUT OF PARA AND AUQUIS COPPER PROJECTS

Latin Metals Inc., further to the company's news release dated Oct. 24, 2025, has entered into an arrangement agreement dated Dec. 8, 2025, with Latin Explore Inc., a wholly owned non-arm's-length subsidiary of the company, pursuant to which the parties intend to complete a spinout transaction of the company's Para and Auquis copper projects, located in Peru.

The spinout will provide shareholders of the company with parallel value-creation opportunities in Latin America. Latin Explore will operate as a self-financed, discovery-driven exploration company, executing on drill-ready projects that can deliver potential near-term discovery. Latin Metals will continue to operate with its proven prospect generator model, advancing early-stage assets through to partner-financed exploration, minimizing or ultimately eliminating shareholder dilution in favour of asset-level dilution and industry-leading exploration partnerships.

"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."

Arrangement details

The spinout will be completed by way of a statutory plan of arrangement under the British Columbia Business Corporations Act. The arrangement involves, among other things, the expected distribution of approximately 10,944,000 common shares of Latin Explore to the company's shareholders, other than dissenting shareholders, in proportion to their respective holdings of common shares of the company on the share distribution record date, which will be the business day immediately preceding the effective date of the arrangement or such other date as determined by the company's board of directors. The company is expected to retain approximately 2,736,000 Latin Explore shares. Upon completion of the arrangement, shareholders of the company will hold approximately 28.3 per cent, the company will hold approximately 7.1 per cent, and shareholders of Finco (as defined below) will hold approximately 64.6 per cent of the issued and outstanding Latin Explore shares. Latin Explore will be a reporting issuer in the provinces of British Columbia and Alberta upon completion of the arrangement, and intends to apply for a listing of the Latin Explore shares on the TSX Venture Exchange.

Prior to the completion of the arrangement, Latin Explore will complete a share exchange with a private British Columbia company (Finco), which will have completed a non-brokered private placement of 25 million subscription receipts for aggregate gross proceeds of $2.5-million at a price of 10 cents per subscription receipt. Upon satisfaction of certain conditions, each subscription receipt will automatically be converted into a unit of Finco without further payment or action on the part of the holder. Each Finco unit will consist of one common share in the capital of Finco and one-half of one common share purchase warrant of Finco. Each Finco warrant will be exercisable into one Finco share at an exercise price of 20 cents per Finco share for a period of 24 months from the date of issuance.

Finco may pay finders' fees on all or a portion of the concurrent financing, consisting of a cash commission equal to up to 7 per cent of the total gross proceeds raised and non-transferable finders' warrants equal to up to 7 per cent of the total number of subscription receipts issued. Each finder's warrant will be exercisable into one Finco share at an exercise price of 10 cents per Finco share for a period of 12 months from the date of issuance.

Upon closing of the share exchange, each Finco share will be exchanged for one Latin Explore share and each Finco warrant and finder's warrant will entitle the holder thereof to receive one Latin Explore share, on the schedule and terms established at the time of the respective issuances of such Finco warrants and finder's warrants.

The gross proceeds of the offering will be held in escrow and, upon the satisfaction or waiver of the escrow release conditions, the gross proceeds will be released to Finco (less any finders' fees, if applicable). In the event that the escrow release conditions are not satisfied within 180 days following the closing of the concurrent financing and subject to Finco extending the outside date by an additional 30-day period, the escrowed proceeds of the concurrent financing will be returned to holders of subscription receipts on a pro rata basis, with Finco contributing such amounts as necessary to satisfy any shortfall. The net proceeds from the concurrent financing are intended to be used primarily by Latin Explore (postshare exchange) for its work programs and for general working capital purposes.

A copy of the arrangement agreement will be posted on SEDAR+ under the company's profile. Further details regarding the arrangement will be included in the management information circular of the company that is expected to be mailed to shareholders in mid-December, 2025, for the company's special meeting of shareholders scheduled for Jan. 14, 2026, at which the shareholders of the company will vote on the arrangement.

The company established a special committee of the board, composed solely of independent directors, to review the arrangement. Following its review, and the receipt of financial advice, the special committee unanimously recommended that the board approve the arrangement and recommend that the company's shareholders vote in favour of the arrangement. Evans & Evans Inc. has provided a verbal opinion to the special committee with respect to the arrangement to the effect that, subject to the assumptions, limitations and qualifications stated in the written opinion of Evans & Evans, the arrangement is fair, from a financial point of view, to the company's shareholders. Evans & Evans will receive a fixed fee for its services that is not dependent on the completion of the arrangement. Following the receipt of the recommendation from the special committee and the verbal opinion from Evans & Evans, the board has determined that the arrangement is in the best interests of the company. A description of the various factors considered by the board in arriving at this determination will be provided in the circular.

The arrangement remains subject to customary conditions, including, among other things, the approval of: (i) two-thirds of the votes cast by shareholders of the company at the shareholders meeting; (ii) a majority of the votes cast at the shareholders meeting, excluding votes cast by persons required to be excluded under Multilateral Instrument 61-101, Protection of Minority Security Holders in Special Transactions; and (iii) shareholders in accordance with the corporate finance policies of the TSX-V, as well as approval of the Supreme Court of British Columbia. There can be no assurance that such approvals will be obtained or that the arrangement will be completed on the terms contemplated or at all. The listing of the Latin Explore shares on the TSX-V will be subject to Latin Explore meeting the TSX-V listing requirements.

About the Para and Auquis copper projects

Para copper project

Latin Metals acquired its 100-per-cent-owned Para copper project through staking in 2023 and expanded it in 2025 through acquisition of additional property. The company initially completed systematic geochemical sampling and interpretation, confirming the presence of multiple porphyry-style targets. Latin Metals subsequently purchased historical exploration data from Vale Exploration Peru S.A.C., a subsidiary of Vale Canada Ltd. (see previous news release dated Feb. 10, 2025), allowing Latin Metals to leverage Vale's extensive prior work, minimizing risk and accelerating the next stages of exploration. Vale's exploration efforts included geochemical rock sampling, induced polarization, ground magnetic and radiometric surveys, and resulted in the identification of four drill targets. Historically, Vale completed drill permitting, providing a strong indication that Para is a project where new drill permits could be obtained in due course.

The company has retained SLR Consulting (Canada) Ltd. to complete a National Instrument 43-101 technical report on the Para project, which is intended to constitute Latin Explore's qualifying property within the meaning of TSX-V policies.

Auquis copper project

The Auquis copper project has potential for multiple deposit types, including copper-molybdenum porphyry and skarn. Surface exploration discoveries at Auquis to date include the Rose zone, where strong magnetic anomalies correspond with anomalous copper mineralization, and the Blanco zone, where intense magnetic anomalies align with skarn alteration and base metal mineralization.

Qualified person (QP)

Eduardo Leon, QP, is the company's qualified person as defined by NI 43-101, and has reviewed the scientific and technical information that forms the basis for portions of this news release. He has approved the disclosure herein. Mr. Leon is not independent of the company, as he is an officer of the company and holds securities of the company.

About Latin Metals Inc.

Latin Metals is a copper, gold and silver exploration company operating in Peru and Argentina under a prospect generator model, minimizing risk and dilution while maximizing discovery potential. With 18 projects, the company secures option agreements with major mining companies to finance exploration. This approach provides early-stage exposure to high-value mineral assets.

We seek Safe Harbor.