Pacific Potash Corp., (TSX-V: PP; OTCQX: PPOTF; FSE: P9P, “Pacific Potash”or the "Company”) is pleased to announce that its merger partner, Pan American (CNSX: PAF, “Pan American”) has confirmed a sales price of $97.81 USD / per tonne as per its terms of the previously announced non-binding letter of intent (the “LOI”) with Agro Industrial Campos Nuevos (“Agro Industrial”) on October 17th 2012. Under the terms of the LOI, Pan American will sell Agro Industrial between 30,000 and 50,000 tonnes of calcium sulphate (agricultural gypsum) over a 12 month period at an agreed sales price of $97.81USD / per tonne.
Randy Wright, President and CEO of Pan American reported “The establishment of such a strong sales price connected to a large potential sale contract is great news for Pan American and its shareholders. It allows us to further quantify the value of our Argentinean calcium sulphate assets, while also proving that our product will command a premium price in the massive domestic and international market for our product.”
Repricing of Concurrent Financing
Pan American also announced that further to the press release dated September 21, 2012, the terms of the concurrent financing (the “Concurrent Financing”) to be completed in connection with a statutory plan of arrangement with Pacific Potash Corporation (the “Transaction”) have been revised.
The Concurrent Financing will be completed by way of a private placement of units (each a “Unit”) and subscription receipts (each a “Subscription Receipt”) at a price of $0.25 per Unit or Subscription Receipt, as applicable, for total aggregate minimum gross proceeds of $2,000,000 and maximum aggregate gross proceeds of $5,000,000. Each Subscription Receipt will be deemed to be exchanged upon certain release conditions being met, without payment of any additional consideration, for one Unit. Each Unit will be comprised of one common share of Pan American (each a “Share”) and one common share purchase warrant of Pan American (each a “Warrant”). Each Warrant will entitle the holder to purchase one Share at a price of $0.40 for a period of five years from the closing of the Concurrent Financing. Pan American currently intends to list the Warrants for trading on the TSX Venture Exchange. There can be no assurance that such listing will be completed.
Pan American also advised that it has entered into an engagement letter with Jordan Capital Markets Inc. (the “Agent”) to act as agent on a commercially reasonable efforts basis, in connection with the offering of a portion of the Concurrent Financing by way of a brokered private placement of Units for minimum gross proceeds of $500,000 and maximum gross proceeds of $1,000,000 (the “Brokered Offering”).
In connection with the Concurrent Financing and the Transaction, Pan American may pay finder’s fees in cash, securities or a combination of both, up to the maximum amount permitted by the TSXV or CNSX, as applicable. Pan American intends to use the proceeds of the Concurrent Financing to fund the costs of the Transaction and to fund the general working capital expenses of the resulting issuer.
About Pacific Potash Corporation
Pacific Potash Corporation trades on the TSX Venture Exchange under the symbol: PP, as well on the OTCQX under the symbol: PPOTF and on the Frankfurt Stock Exchange under P9P. Pacific Potash is engaged in the exploration and development of the Provost Potash Property and the surrounding potash claims targeting the prolific Prairie Evaporite Formation, which is host to multiple conventional and solution potash mines. The Company also has an option to acquire an 80% interest in Western Potash Corporation’s (TSX: WPX) Amazonas Basin claims.
About Pan American
Pan American is a Canadian company dedicated to providing fertilizer to growing global markets specifically in South and Central America. The company is focused on the extraction of a specific type of fertilizer called calcium sulphate (also referred to as “Agricultural Gypsum”) currently in Argentina. To ensure long term development and increase shareholder value, Pan American currently plans to significantly expand its current operational objectives while expanding its asset base by acquiring additional calcium sulphate and other fertilizer related assets and by expanding its markets to neighbouring countries with Argentina.
When used as a fertilizer and as a soil remediator, calcium sulphate is a soft sulfate mineral composed of calcium sulfate dihydrate which is extremely rich in sulphur and calcium. When dissolved in water, the mineral becomes calcium and sulphate sulphur ions, both of which are required nutrients for plants. Calcium sulphate plays a vital role in establishing and maintaining good chemical balance in soil, water and plants, specifically with healthy root development. Ultimately, calcium sulphate increases overall crop quality and yields. www.PAFertilzer.com
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