DuSolo Fertilizers Inc.
TSX VENTURE : DSF

DuSolo Fertilizers Inc.

October 01, 2015 21:53 ET

DuSolo Secures $3.2 Million in Financings

Closes First Tranche of Private Placement and Arranges Convertible Loan

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Oct. 1, 2015) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

DuSolo Fertilizers Inc. (TSX VENTURE:DSF) ("DuSolo" or "the Company") is pleased to announce that it has closed the initial tranche of its non-brokered private placement ("the Private Placement") previously announced on September 14 and September 18, 2015 and has signed a one-year convertible loan agreement, for aggregate gross proceeds of C$3.2 million.

"We are encouraged by the support we received from the market for this financing," said Darren Bowden, Chief Executive Officer. "DuSolo is now in a financial position where we can move forward with our plans to improve our operations, increase sales and marketing activities, and begin exploration at our newly acquired asset."

A total of C$2,434,500 has been raised through the issuance of 24,345,000 units ("Units") of the Company at a price of C$0.10 per Unit. Each Unit consists of one common share of the Company ("Common Share") and one-half Common Share purchase warrant ("Warrant"). Each whole Warrant entitles the holder to acquire one common share at an exercise price of C$0.15 for a period of 36 months from the closing date of the Private Placement. Lead orders came from existing shareholders including M&G Investment Management and the Tembo Capital group ("Tembo Capital"), as well as from certain directors of the Company. Due to the significant interest DuSolo received in the Private Placement, it is considering subscriptions in excess of C$2.5 million.

The Company also announces that it has executed a one-year convertible loan agreement with Tembo Capital pursuant to which Tembo Capital will advance $750,000 ("the Loan"). The Loan has an interest rate of 10%, an establishment fee of 5%, and Tembo Capital may, at any time, convert the Loan and all interest and fees accruing thereunder into Units carrying the same terms as issued in the Private Placement.

The Company has used approximately $800,000 from the proceeds of the Private Placement to repay the principal amount and all interest and fees accrued under the three-month bridge loan from Tembo Capital. The remainder of the proceeds from the Private Placement and the Loan will be used to for working capital as DuSolo continues to improve its operations and market its Direct Application Natural Fertilizer products. In addition, funds will be used further define the resource at Bomfim, and begin the exploration program at the Company's new asset, São Roque.

Following closing of the Private Placement, Tembo Capital holds 28,063,519 common shares of the Company representing 18.15% of the Company's issued and outstanding shares. Pursuant to the policies of the TSX Venture Exchange (the "TSX-V"), a company must obtain disinterested shareholder approval prior to the issuance of securities to a shareholder that would result in that person becoming a "Control Person" as defined in the policies of the TSX-V. DuSolo has agreed to seek such approval with respect to the issuance of securities to Tembo Capital pursuant to the Loan and exercise of any Warrants it holds at its next shareholder meeting.

All securities issued in connection with the Private Placement and the Loan will be subject to a minimum four-month hold period. The Company paid a commission of C$109,060 in cash and 1,090,600 brokers warrants on a portion of the proceeds raised from the sales of Units in the first tranche of the Private Placement.

Tembo Capital is an "insider" and a "related party" (as such terms are defined in applicable securities laws) of the Company and accordingly, Tembo Capital's participation in the Private Placement and the Loan are "related party transactions" under Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Tembo Capital's participation in the Private Placement and the Loan will be exempt from the formal valuation and minority shareholder approval requirements under MI 61-101 because at the time the transactions, neither the fair market value of the Units acquired by Tembo Capital, or the consideration paid therefor or the principal amount of the Loan exceeds 25% of the Company's market capitalization.

This news release does not constitute an offer to sell or a solicitation of an offer to sell any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

ABOUT DUSOLO

DuSolo Fertilizers Inc. is focused on developing a fully integrated process to produce and sell phosphate based fertilizers within the Cerrado region of Brazil as part of a nationwide effort, incentivized by the government, to increase supply of domestically sourced fertilizers and achieve agricultural self sufficiency.

On behalf of DuSolo Fertilizers Inc.

Darren Bowden, Chief Executive Officer

Forward-looking statements

Certain information contained in this press release constitutes "forward-looking information", within the meaning of Canadian legislation. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur", "be achieved" or "has the potential to". Forward looking statements contained in this press release may include statements regarding the future operating or financial performance of DuSolo which involve known and unknown risks and uncertainties which may not prove to be accurate. Actual results and outcomes may differ materially from what is expressed or forecasted in these forward-looking statements. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Among those factors which could cause actual results to differ materially are the following: market conditions and other risk factors listed from time to time in our reports filed with Canadian securities regulators on SEDAR at www.sedar.com. The forward-looking statements included in this press release are made as of the date of this press release and DuSolo disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities legislation.

Neither the TSX Venture Exchange Inc. nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange Inc.) accepts responsibility for the adequacy or accuracy of this press release.

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