DuSolo Fertilizers Inc.
FRANKFURT : E6R
PINKSHEETS : ELGSF
TSX VENTURE : DSF

DuSolo Fertilizers Inc.

February 26, 2015 09:30 ET

DuSolo Signs Agreement to Purchase Phosphate at a Large Discount

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Feb. 26, 2015) - DuSolo Fertilizers Inc., (FRANKFURT:E6R)(OTC PINK:ELGSF)(TSX VENTURE:DSF) ("DuSolo" or "the Company") is pleased to announce that it has entered into an agreement with a fertilizer producer ("the Seller") located in close proximity to the Bomfim project area for the purchase of goods ("the Agreement"), effective February 17, 2015 (the "Effective Date"). According to the Agreement, DuSolo ("the Buyer") will purchase 33,071 tonnes of phosphate rock ("the Goods") for a total amount of CAD$751,636 ("the Sales Price") or an attractive CAD$22/tonne (as per the February 26th, 2015 exchange rate).

DuSolo intends to blend the 33,071 tonnes of phosphate around 10% P2O5 with high-grade phosphate from its Bomfim Project to produce Direct Application Natural Fertilizer ("DANF") with an average grade of ~14-15% P2O5. The Company will then sell this DANF to farmers in the region who have expressed their interest in this specific product.

"The favorable terms we were able to negotiate as part of this purchase will not only help DuSolo meet its production targets this year, but are expected to greatly improve the economics of DANF production in coming months," said Eran Friedlander, President and CEO of DuSolo. "With a 40,000 tonne sales contract already in place and additional orders expected shortly, we believe 2015 is going to be a busy year for DuSolo."

PAYMENT TERMS

The Sales Price for the 33,071 tonnes was based on an average price of 50 Reals per tonne (~CAD$22/tonne as per the February 26th, 2015 exchange rate) of phosphate delivered. A non-refundable down payment of CAD$275,000 was made right after the Effective Date of when the Agreement was signed. The remaining balance of CAD$476,636 is due in three installments of 30, 60, and 90 days after the Initial Payment date, and is subject to DuSolo completing further quality testing of the materials purchased.

DuSolo will quality test the Goods within the 30 days before the second payment is due to confirm both tonnage and grade. The remaining balance of CAD$476,636 will be paid according to the following agreed upon terms:

  • Quality testing confirms a weighted average P2O5 grade of the Goods is equal to or greater than 9% - remaining balance to be paid in full.
  • Quality testing confirms weighted average P2O5 grade of the Goods is less than 9% but greater than 8% - remaining balance will be adjusted to CAD$288,727.
  • Quality testing confirms weighted average P2O5 grade of the Goods delivered is equal to or less than 8% - no additional payments shall be made to the Seller and the Buyer shall keep the Goods.

CORPORATE UPDATE

DuSolo has granted an aggregate of 3,020,000 options at a price of $0.23 to 20 individuals in the Company, including employees, officers and directors. The options are granted under the amended 2014 stock option plan and expire on February 2, 2020.

ABOUT THE COMPANY

DuSolo Fertilizers Inc. (FRANKFURT:E6R)(OTC PINK:ELGSF)(TSX VENTURE:DSF) is a Canadian based, low-cost phosphate producer operating in the world's fastest growing agricultural district: the Brazilian "Cerrado," where demand for fertilizers far exceeds domestic supply.

On behalf of the Board of Directors

DuSolo Fertilizers Inc.

Eran Friedlander, President and CEO

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.

Disclosure

The Company is not basing its decision to begin production of DANF on a feasibility study of mineral reserves demonstrating economic and technical viability. Without a technical report demonstrating economic and technical viability, there is increased uncertainty as to whether DuSolo will be able to economically produce DANF products and as to whether DuSolo will be confronted with any unforeseen technical impediments. Similarly, the Company has not completed a preliminary economic assessment before making production and project expansion decisions.

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.

Contact Information

  • DuSolo Fertilizers Inc.
    Patrick Brandreth
    Senior Manager, Corporate Development
    1-604-282-7157
    patrick@DuSolo.com