ARCF I Closes Private Sales of Largo Shares

/FOR DISSEMINATION IN CANADA AND OVER CANADIAN NEWS SERVICES ONLY/

TORONTO, Oct. 10, 2018 /CNW/ - Arias Resource Capital Fund L.P. ("ARCF I") announced that it privately sold pursuant to share purchase agreements dated October 5, 2018, an aggregate of 13,864,406 common shares ("Common Shares") in the capital of Largo Resources Ltd. ("Largo") at a previously negotiated and accepted price of U.S.$2.08 per Common Share, for aggregate proceeds of U.S.$28,837,964.48 (the "Private Sales"). The effective closing date of the Private Sales was October 9, 2018.

Following the Private Sales, ARCF I, Arias Resource Capital Fund II L.P. ("ARCF II") and Arias Resource Capital Fund II (Mexico) L.P. ("ARCF II Mexico", and together with ARCF I and ARCF II, the "ARC Funds"), own, in the aggregate, 239,612,424 Common Shares and 90,174,853 common share purchase warrants ("Warrants"). J. Alberto Arias has been granted for service on the Largo Board of Directors a total of 438,000 vested options to acquire Common Shares ("Options"). Giving effect to the disposition of Common Shares under the Private Sales and assuming the exercise in full of the Warrants by the ARC Funds and the vested Options by J. Alberto Arias, the Common Shares held by the ARC Funds and J. Alberto Arias, collectively, would represent approximately 53.86% of the total outstanding Common Shares of Largo, on a partially diluted basis, representing a decrease of approximately 2.26%, as summarized below:

	Common Shares issuable on exercise or conversion
	Common Shares Owned	Warrant Shares	Option Shares	Partially Diluted Total	% Change in Ownership
J. Alberto Arias	---	---	438,000	438,000 (0.08%)	(0.00%)
ARCF I	13,576,893 (2.60%)	13,156,707	---	26,733,600 (4.99%)	(2.59%)
ARCF II	213,899,479 (40.94%)	72,882,972	---	286,782,451 (48.17%)	(0.00%)
ARCF II (Mexico)	12,136,052 (2.32%)	4,135,174	---	16,271,226 (3.09%)	(0.00%)
TOTAL:	239,612,424 (45.86%)	90,174,853	438,000	330,225,277 (53.86%)	(2.26%)

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 Common Shares were disposed of by ARCF I as a result of investment considerations including price, market conditions, availability of funds, evaluation of alternative investments and other factors. The ARC Funds may, from time to time, acquire additional securities of Largo and/or dispose of such securities as they may deem appropriate. The ARC Funds currently have no other immediate plans or intentions to acquire or dispose of securities of Largo, but depending on market conditions, general economic and industry conditions, trading prices of securities of Largo, Largo's business, financial condition and prospects and/or other relevant factors, the ARC Funds may develop such plans or intentions in the future.

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

The dissemination of this release in the United States or to any United States news service may constitute a violation of U.S. securities laws.

SOURCE ARIAS RESOURCE CAPITAL FUND L.P.

J. Alberto Arias, Director, phone: [phone], e-mail: [email protected]