Gensource and CPC have agreed to work exclusively through Gensource to advance the exploration, development, mining and marketing of potash from properties in the Province of Saskatchewan, except for those projects currently held by CPC (other than the Permits).
CPC has agreed to use its commercially reasonable efforts to assist Gensource to arrange: (i) project joint ventures; (ii) debt and equity project finance; (iii) the import and sale of potash from Gensource's properties internationally, including to and within the PRC; and (iv) the shipping or logistics associated with the distribution of potash internationally, including to and within the PRC - to the extent that such arrangements cannot be achieved through the contacts and assigned agreements provided by CPC to Gensource pursuant to the Subscription and Purchase Agreement.
The execution of the Subscription and Purchase Agreement and the Shareholder's Agreement are not a condition precedent to the Term Sheet or the respective obligations of CPC and Gensource contained in the Term Sheet.
The Term Sheet and the Subscription and Purchase Agreement will be terminated if the transaction has not closed within 120 days.
Mike Ferguson, CEO of Gensource, commented: "Gensource is very pleased to announce this agreement to align and combine business efforts between our two companies. Gensource's business model requires that all three required pillars that support a successful project be in place as early as possible in the project development cycle. Those pillars are market access, financial capacity and execution expertise. This proposed transaction will put all three of those pillars in place and that will clear the way for efficient and focused project development with the goal to put one or more projects into production in the coming years."
Under the Term Sheet, Mike Ferguson will continue in his role as CEO of the Company. Mike Ferguson is a professional engineer with over 25 years experience in potash and uranium mining projects in Saskatchewan. Mike graduated from the University of Saskatchewan with a B.Sc. in Mechanical Engineering. Following a few years spent with the Canadian Military, Mike settled back in Saskatoon and has spent his entire mining career in Saskatchewan participating in projects in potash, uranium, gold and base metals. His experience ranges from working at the mining face behind a Marietta Miner in a potash operations, to in-plant engineering (both surface plant and underground), engineering management, project management through to general management of engineering and EPCM companies. Most recently, Mike successfully led the Potash One project team responsible for the development of the Legacy Project in Southern Saskatchewan from initial exploration through scoping-, pre-feasibility- and feasibility studies and an approved EIS, to the point where it was acquired by the international potash producer K+S Group of Germany. Mike brings to Gensource not only his experience in the potash industry but also the unique experience of leading the development of a greenfield potash property in Saskatchewan - the first such project to be developed in over 40 years.
The Company will issue a subsequent press release providing further information regarding the transaction as required by the policies of the TSX Venture Exchange.
Trading of the shares of the Company on the TSX Venture Exchange will remain halted until the Company has satisfied all of the requirements of the TSX Venture Exchange necessary to reinstate trading.
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