Ethiopian Potash to Issue More Equity as Part of G&B Acquisition; Shares Off Halt at 145 pm ET
Ethiopian Potash Corp. (FED-WT.TO) said it has amended an option agreement so that more equity will be issued to acquire G&B Central African Resources Ltd, owner of a key property in Ethiopia.
Shares are halted until 145 p.m ( ET ).
Under the terms of the original option agreement, the G&B shareholders and the founders were to have receive 13.0 million shares of EPC to exercise the option, as well as $1,000,000 in cash to the G&B Shareholders and $1,000,000 in cash to the founders upon the satisfaction of a feasibility study in respect of the Danakil property.
EPC has agreed, subject to regulatory and shareholder approval, to issue a potential additional 38.5 million shares under the amending Aareement, with 13.5 million shares being issued to the founders and 25 million shares issued to G&B Shareholders. These share issuances are in lieu of the 13.0 million shares and $2,000,000 in cash payable to the founders and the G&B shareholders in the original option agreement.
George Roach, EPC's chairman and CEO, stated: "That EPC did not hold direct title to the properties, combined with the current cash deficit and trying market conditions, resulted in understandable concern. This agreement confirms the commitment of the G&B Shareholders to a common destiny with EPC and addresses some of the concern."