Encanto Potash Corp.: Announces Replacement of Expired Convertible Debentures
Vancouver - Encanto Potash Corp. ("Encanto" or the "Company") (TSXV: EPO) announces that, further to its news release of March 14, 2016, It has now received approval of the TSX Venture Exchange for the issuance of its March 1, 2016 convertible debentures in the aggregate principal amount of $7.7 million. The March 1, 2016 convertible debentures are being issued in replacement of previously outstanding convertible debentures in the aggregate principal amount of $7 million plus accrued interest of $0.7 million which matured on January 14, 2016. The March 1, 2016 convertible debentures are secured by all of the assets of the Company, bear interest at the rate of 7.5% per annum, will mature on September 1, 2017 and are convertible in whole or in part at the option of the holders into common shares of the Company at a price of $0.10 per common share on or before September 1, 2017.
Early Warning Requirements
In replacement for his convertible debenture which matured on January 14, 2016, Hamad M. Al-Wazzan acquired a March 1, 2016 debenture in the principal amount of $5,437,808.22 which is convertible into 54,328,082 common shares, which would represent 12.8% of the issued and outstanding common shares of Encanto on a partially diluted basis. Mr. Al-Wazzan now beneficially owns and controls 31,574,509 common shares of Encanto representing 8.5% of the issued and outstanding common shares of Encanto. Mr. Al-Wazzan also beneficially owns and controls options to purchase 1,575,000 common shares of Encanto and the debenture convertible into 54,328,082 common shares of Encanto. Assuming full exercise of the options and conversion of the debenture in full, Mr. Al-Wazzan would beneficially own and control 87,477,591 common shares of Encanto representing 20.6% of the issued and outstanding common shares of Encanto on a partially diluted basis. Mr. Al-Wazzan acquired the securities for investment purposes and may acquire further securities of Encanto in the future.
About Encanto:
Encanto Potash Corp. is a TSX Venture Exchange listed and traded Canadian resource company engaged in the development of potash properties in the Province of Saskatchewan, Canada, the largest producing potash region in the world. Through a joint venture agreement with Muskowekwan Resources Ltd. ("MFN JV") on our flagship property, Encanto has a project land package which totals approximately 61,000 largely contiguous acres. A Pre-Feasibility Study dated February 28 2013 titled "Encanto Potash Corp. Technical Report Summarizing the Preliminary Feasibility Study for the Muskowekwan First Nations Home Reserve Project in South Eastern Saskatchewan, Canada" confirms the Proven & Probable KCI Reserves totaling 162 MMt grading 28% which supports primary and secondary mining for over 50 years at an assumed annual rate extraction rate of 2.8 million tonnes.
The Company also has an interest in another potash property in Saskatchewan: 5% interest in the 55,000 acre Ochapowace/Chacachas property.
Encanto is currently exploring domestic & international strategic partnerships for the financing, development and sale of potash production from its MFN JV Property.
The technical content of this news release has been reviewed and approved by James Walchuck, a qualified person as defined by NI 43-101.
For additional information about Encanto Potash Corp., please visit the Company's website at www.encantopotash.com or review the Company's documents filed on www.sedar.com.
ON BEHALF OF THE BOARD OF DIRECTORS
Per: James Walchuck
Chief Executive Officer
For further information please contact:
Encanto Potash Corp.
James Walchuck, Chief Executive Officer
Tel: 604-683-2402
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
THE FOREGOING INFORMATION MAY CONTAIN FORWARD-LOOKING INFORMATION RELATING TO THE FUTURE PERFORMANCE OF THE COMPANY. FORWARD LOOKING INFORMATION IS SUBJECT TO A NUMBER OF KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE ANTICIPATED IN OUR FORWARD LOOKING STATEMENTS. SUCH RISKS AND OTHER FACTORS INCLUDE, AMONG OTHERS, THE ACTUAL RESULTS OF EXPLORATION ACTIVITIES, CHANGES IN WORLD COMMODITY MARKETS OR EQUITY MARKETS, THE RISKS OF THE MINING INDUSTRY INCLUDING, WITHOUT LIMITATION, THOSE ASSOCIATED WITH THE ENVIRONMENT, DELAYS IN OBTAINING GOVERNMENTAL APPROVALS, PERMITS OR FINANCING OR IN THE COMPLETION OF DEVELOPMENT OR CONSTRUCTION ACTIVITIES, TITLE DISPUTES, CHANGE IN GOVERNMENT AND CHANGES TO REGULATIONS AFFECTING THE MINING INDUSTRY, AND OTHER RISKS AND UNCERTAINTIES DETAILED FROM TIME TO TIME IN THE COMPANY'S FILINGS WITH THE CANADIAN SECURITIES ADMINISTRATORS (AVAILABLE AT WWW.SEDAR.COM). FORWARD-LOOKING STATEMENTS ARE MADE BASED ON VARIOUS ASSUMPTIONS AND ON MANAGEMENT'S BELIEFS, ESTIMATES AND OPINIONS ON THE DATE THE STATEMENTS ARE MADE. SHOULD ONE OR MORE OF THESE RISKS AND UNCERTAINTIES MATERIALIZE, OR SHOULD UNDERLYING ASSUMPTIONS PROVE INCORRECT, ACTUAL RESULTS MAY VARY MATERIALLY FROM THOSE DESCRIBED IN THE FORWARD-LOOKING INFORMATION CONTAINED HEREIN. THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE FORWARD-LOOKING STATEMENTS IF THESE ASSUMPTIONS, BELIEFS, ESTIMATES AND OPINIONS OR OTHER CIRCUMSTANCES SHOULD CHANGE, EXCEPT AS REQUIRED BY APPLICABLE LAW
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