Wednesday, February 29, 2012 3:00:16 PM
(The following was released on behalf of Ethiopian Potash by its communications firm.)
TREASURY
We believe that Ethiopian Potash has been under pressure based on
misunderstandings most recently aroused by poor research coverage
from a group that had hoped to lead the next financing effort, but
no doubt is nonplussed now by the fact that fees (the main driver of
the investment banking business model) will not be forthcoming.
With regard to our treasury - the company will not dilute current
stockholders at these depressed levels the way that has been
witnessed recently by comparables in the basin.
FED intends to retain its leverage to the Danakil in terms of
tonnage of sylvite per share.
Those selling in anticipation of reloading from an upcoming private
placement will be disappointed to not achieve their desired goal.
EPC is very comfortable with its financial situation, the backing of
KEY founders, and its ability to tap capital markets at the
appropriate time.
TITLE
As per below, title is completely sound, as it always was. Please
note the below extractions from the option agreement, also available
in the initial prospectus filed during the RTO last year at http://www.sedar.com/
EPC entered into an option agreement (the “Option Agreement”) with G
and B Central African Resources (“G&B”) and the shareholders of G&B
on September 7, 2010 (as amended on October 18, 2010, December 1,
2010 and January 18, 2011). Pursuant to the Option Agreement, EPC
was granted an option to acquire all of the issued and outstanding
shares of G&B and thereby indirectly acquire all of G&B’s interest
in the Danakil Potash Permits. To exercise the option granted under
the Option Agreement, EPC must meet certain milestones and make
certain related payments within 10 years of the effective date of
the Option Agreement. The option automatically terminates if not
fully exercised in 10 years. On April 11, 2011, an aggregate of
17,368,726 common shares of EPC were issued in connection with the
satisfaction of the requirements of the First Milestone under the
Option Agreement. In order to meet the Second Milestone, EPC must
complete a feasibility study. The completion of the Second Milestone
will result in the full exercise of the option granted under the
Option Agreement. EPC has 8 years and 10 months to do so, and that
is the only outstanding obligation.
Adam Chambers
416 907 9422
achambers@gmfbcommunications.ca
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