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TORONTO , May 15, 2015 /CNW/ - Arias Resource Capital Fund L.P. ("ARCF I"), Arias Resource Capital Fund II L.P. ("ARCF II") and Arias Resource Capital Fund II ( Mexico ) L.P. ("ARCF II Mexico", together with ARCF I and ARCF II, the "ARC Funds") announced today that all outstanding principal and interest under the Cdn$12 million non-revolving, convertible term loan facility (the "Bridge Loan") with Largo Resources Ltd. ("Largo")(LGO.V) was repaid in full, in cash, following the closing on May 14, 2015 of the first tranche of Largo's previously announced Unit offering (the "Offering").

Under the first tranche of the Offering, the ARC Funds, collectively, acquired an aggregate of 15,312,498 Units at a price of $0.80 per Unit for an aggregate subscription price of Cdn$12,250,000 . Each Unit consists of one common share in the capital of Largo ("Common Shares") and one half of one Common Share purchase warrant. Each whole warrant entitles the holder to acquire one further Common Share at a price of Cdn$1.50 per Common Share for a period of one year from the date of issuance.

Prior to the closing of the first tranche of the Offering, the ARC Funds owned an aggregate of 30,787,975 Common Shares and 6,407,141 Common Share purchase warrants ("Warrants"). J. Alberto Arias , the sole director of each of the general partners of the ARC Funds and a director on the board of Largo, currently holds options to purchase 100,000 Common Shares of Largo ("Options"), 25,000 of which are vested. Giving effect the acquisition of Units under the first tranche of the Offering and repayment of the convertible Bridge Loan and assuming the exercise in full of the Warrants and the exercise in full of the vested Options, the Common Shares held by J. Alberto Arias and the ARC Funds, collectively, would represent approximately 41.19% of the total outstanding Common Shares of Largo, on a partially-diluted basis, as summarized below:

The ARC Funds, collectively, may acquire up to an additional 48,000,000 Units at a price of $0.80 per Unit for an aggregate subscription price of Cdn$38,400,000 pursuant to a second tranche of the Offering that is expected to close on or about May 19, 2015 . Participation by the ARC Funds in the second tranche is conditional upon several conditions, including the execution and delivery of a director nomination agreement permitting the ARC Funds to nominate two new directors to Largo's board of directors. This nomination right is in addition to the ARC Funds' existing right to nominate one director to Largo's board of directors under the existing governance agreement.

The ARC Funds are managed by Arias Resource Capital Management LP (the "Manager"). The respective general partner of each of the ARC Funds retains the power to make investment and voting decisions in respect of the Largo securities beneficially owned by the ARC Funds. J. Alberto Arias is the sole director of each of the general partners of the ARC Funds and indirectly controls the Manager. As such, Mr. Arias may be deemed to share voting and dispositive power with respect to the Largo securities beneficially owned by the ARC Funds, but he disclaims any beneficial ownership of any such securities, except to the extent of his pecuniary interest therein.

The ARC Funds may, from time to time, subject to all necessary regulatory approvals, acquire additional securities of Largo and/or dispose of such securities as they may deem appropriate.

This news release has been disseminated in accordance with the early warning requirements of Canadian provincial securities laws.

SOURCE ARIAS RESOURCE CAPITAL FUND L.P.

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