Ethiopian Potash Enters Into Memorandum of Understanding Regarding Early Exercise of Option, A US$10 Million Investment and A

Ethiopian Potash Enters Into Memorandum of Understanding Regarding Early 
Exercise of Option, A US$10 Million Investment and A Joint
Venture on Danakil Property 
TORONTO, ONTARIO -- (Marketwire) -- 01/30/13 -- Ethiopian Potash
Corp. (the "Company" or "EPC") (TSX VENTURE:FED) is pleased to
announce that it has entered into a memorandum of understanding (the
"MOU") which contemplates the early exercise of its option (the
"Option") to acquire G and B Central African Resources Ltd. ("G&B"),
which owns the Dankil Property, and the forming of a joint venture
between EPC and Danakil Potash Corporation ("Danakil Corp.")
regarding the Danakil Property ("Danakil Joint Venture").  
The MOU contemplates G&B and its sole shareholder ZRH Nominees (0105)
Ltd. ("ZRH") waiving the requirement for a feasibility study (the
"Waiver") under the option agreement among EPC, G&B and ZRH (the
"Option Agreement") in order to enable early exercise of the option
and Danakil Corp. acquiring a 70% interest in the Danakil Property
pursuant to the Danakil Joint Venture. The Waiver will be subject to
satisfaction of all applicable conditions precedent, the
restructuring of all outstanding debt of G&B incurred on behalf of
EPC in connection with the Option and the commitment to a US$10
million investment by Danakil Corp. in the Danakil Joint Venture
having closed in escrow. 
Conditions precedent will include, among other things, due diligence,
the execution of mutually satisfactory definitive agreements among
the parties and obtaining all required approvals, including but not
limited to TSXV and shareholder approvals.  
Danakil Joint Venture 
Danakil Corp. will acquire an interest in the Danakil Property
through an ownership interest in a BVI joint venture company
("JVCo"), which EPC will establish to hold the shares of G&B acquired
under the Option. Danakil Corp. will pay US$3 million (and commit to
additional future expenditures of no less than US$7 million, as
described below) for 70% of the shares of JVCo (US$1.5 million to be
paid into JVCo and US$1.5 million to be paid to EPC). EPC will own
the remaining 30% of the shares of JVCo. The initial proceeds paid to
JVCo are expected to be used to satisfy any outstanding liabilities
and for working capital purposes for the development of the Dana
kil
Property. 
The Danakil Joint Venture will be governed by a shareholders / joint
venture agreement between EPC and Danakil Corp. ("JV Agreement"),
which will provide (among other things) for customary drag & tag and
pre-emptive provisions. Danakil Corp. will have nominees appointed to
the boards of directors of JVCo and G&B (and any other group company
of JVCo), in each case, that together represent a majority of the
respective board of directors. EPC will be entitled to have its
nominees appointed to fill the remaining positions on each respective
board of directors as long as it retains not less than 10% of the
issued share capital of JVCo.  
The JV Agreement will also provide for Danakil Corp. to solely fund
all expenditures of G&B (and any other group company of JVCo) until
both (i) a National Instrument 43-101 compliant scoping study on a
pre-determined section of the Danakil Property has been completed and
(ii) it has funded expenditures totalling US$7 million. After Danakil
Corp. has funded such expenditures, EPC and Danakil Corp. will
contribute to expenditures of G&B on a pro rata basis, subject to
customary dilutive provisions in the event of any failure of a party
to fund its pro rata contribution from time to time. 
The funding of expenditures by Danakil Corp. (as well as any
subsequent pro rata funding by Danakil Corp. and EPC) will be by way
of intra-group loans, on terms to be agreed between the parties. Such
terms are expected to include, without limitation, a substantial
threshold amount which must be met in order for any sale of EPC's
interest in JVCo pursuant to drag rights of Danakil Corp. in the JV
Agreement without EPC's prior approval (in its absolution
discretion). In the event of a sale of Danakil Corp.'s 70% interest
only, it will be a condition of such sale that any intra-group loans
outstanding at such time not become payable as a result of such sale.
In addition, any failure by Danakil Corp. (in breach of its
obligations) to fund any expenditures will result in a claw-back of
Danakil Corp.'s ownership interest in JVCo, on a pro rata basis (i.e.
in order for Danakil Corp. to have maintained a 70% ownership
interest in JVCo at the time of the first pro rata funding by the
parties, it must have funded aggregate expenditures of at least US$10
million). 
The establishment and funding of the Danakil Joint Venture will be
subject to the satisfaction of all related conditions precedent and
will thereafter close in escrow, pending the completion of the
restructuring of G&B debt described below and the Waiver having been
unconditionally granted on or before June 30, 2013. 
Danakil Corp. is a wholly owned BVI subsidiary of Circum Minerals
Ltd., incorporated to pursue mineral opportunities in Eastern Africa.
As at the date of the MOU, each of Circum and Dankil Corp. is at
arm's length to EPC. 
Restructuring of Outstanding Debt 
EPC will assume all outstanding debt of G&B incurred on behalf of
EPC, or otherwise incurred by G&B, in connection with the Option
(being approximately CAD$1.665 million) and will arrange with
substantially all creditors to have all outstanding debt of EPC
(being approximately CAD$3.365 million including all G&B debt to be
assumed) satisfied by the issuance of 33,650,000 common shares in
capital of EPC at a deemed price of CAD$0.10 per share (subject to
TSXV approval). Any debt not satisfied with shares will be satisfied
with part of the US$1.5 million received from Danakil Corp. under the
terms of the Danakil Joint Venture or in due course, as may be agreed
between EPC and any creditor.  
EPC to Acquire New Potash Permits 
The MOU also contemplates the acquisition by EPC, for a total
purchase price of CAD$2 million (which will be satisfied by the
issuance of shares of EPC at a price of $0.10 per share), of certain
rights to acquire potash exploration permits for a group of mineral
substances in Mali. The area is known to have produced table salt
(NaCI), other salts and Sylvite (KCI).  
EPC's acquisition of such permits will be subject to the satisfaction
of all related conditions precedent and will thereafter close in
escrow, pending the completion of the restructuring of G&B debt
described above and the Waiver having been unconditionally granted on
or before June 30, 2013. 
The potash permits are held by a subsidiary of Premier African
Minerals Limited ("PREM"), a mineral exploration and development
company of which ZRH is a principal shareholder, and George Roach and
Pamela Hueston are directors. As a result, minority shareholder
approval of the acquisition may be required under the applicable
securities laws and the rules of the TSXV. As PREM is admitted to
trading on AIM, the disposal will need to comply with the AIM Rules
and other regulatory requirements in the United Kingdom. 
Proposed Name Change 
It is proposed that EPC will (subject to shareholder approval) change
its name to "AgriMinco Corp." or such other name as may be approved
by the board of directors and/or the TSXV connection with EPC's
acquisition of such properties as noted above. 
Exercise or Termination of Option 
Immediately following the satisfaction of all applicable conditions
precedent, the restructuring of outstanding G&B debt and all other
transa
ctions contemplated by the MOU have closed in escrow, G&B and
ZRH will provide the Waiver unconditionally and for no additional
consideration, and the Option will be exercised immediately
thereafter. EPC will be obligated to issue common shares of EPC in
accordance with the Option Agreement in connection with the exercise
of the Option. 
The parties to the MOU have agreed to proceed in good faith and
expeditiously to negotiate, settle and execute the other agreements
contemplated therein by March 1, 2013, and to obtain all third-party
and regulatory approvals as may be required by no later than June 30,
2013. However, no party to the MOU has any obligation with respect to
the transactions contemplated therein (other than as described below)
unless and until definitive agreements have been entered into. There
can be no assurance that the definitive agreements will be entered
into within the time required and/or that the transactions
contemplated in the MOU will be consummated. 
EPC, G&B and ZRH have also agreed to the termination of the Option
Agreement on the earlier of (i) March 1, 2013, unless the parties to
the MOU have settled and executed all the agreements contemplated
therein (the "Contemplated Agreements") and (ii) the termination or
expiration of any of the Contemplated Agreements by any of the
parties thereto in accordance with the terms thereof, unless any such
termination or expiration occurs as a consequence of the completion
of a transaction contemplated by the MOU. Each of G&B and ZRH are
considered related parties to EPC. George Roach, EPC's Chairman and
CEO, is also a director and a principal of G&B and his family trust
will receive the shares to be issued to ZRH under the Option
Agreement.  
The Board of EPC formed special committees to consider the
transactions contemplated by the MOU, other than the Danakil Joint
Venture (which was negotiated at arm's length). The Special Committee
formed to consider the acquisition of certain potash permits from
PREM is comprised of Michael Galloro and Anthony Vella. The Special
Committee formed to consider the potential early termination of the
Option Agreement is comprised of Michael Galloro, Anthony Vella and
Pamela Hueston. George Roach, EPC's Chairman and CEO abstained on all
matters related to the Company's proposed acquisition of potash
permits from PREM as well as the potential early termination of the
Option Agreement, as he is interested in both G&B and ZRH and is a
director of PREM. Pamela Hueston also abstained from all matters
related to the Company's proposed acquisition of potash permits from
PREM due to her position as a director of PREM. 
The Board of EPC has determined that, in the event that the
transactions contemplated by the MOU are not completed, it would be
in the best interest of the Company to terminate its Option and
delist and wind-up the Company, and to return any residual capital to
shareholders. This determination has been made after giving
consideration to the available resources of EPC, EPC having been
unable to pay the outstanding debt of G&B (which debt was incurred on
behalf of EPC) as required by the Option Agreement, the likelihood of
being able to arrange for an alternative transaction or financing
and/or satisfy outstanding obligations in the immediate future and
the extent of financial and other resources that will be required in
order to fund future operations and maintain the Danakil Property
under the terms of the Option Agreement.  
Shareholders Meeting 
The Company will be calling a special meeting of its shareholders to
consider and approve the transactions described herein following the
execution of all relevant definitive agreements, or if the
Contemplated Agreements are not entered into on or before March 1,
2013 the Company will be calling a special meeting of its
shareholders to consider and approve the wind-up the Company. 
About Ethiopian Potash Corp.  
Ethiopian Potash Corp. (TSX VENTURE:FED) is a Canadian company based
in Toronto, Ontario and Addis Ababa, Ethiopia.  
On behalf of the Board of Directors 
George Roach, CEO & Director 
Forward-Looking Information 
This press release may contain forward-looking statements based on
assumptions, uncertainties and management's best estimates of future
events. All statements that address future activities, events or
developments that the Company believes, expects or anticipates will
or may occur (including, but not limited to, the potential for and
timing of the early exercise of the Option, acquisition of the new
potash permits, the Danakil Joint Venture and the restructuring of
outstanding debt, as well as the expected terms and conditions of
each such transaction) are forward-looking information.
Forward-looking information is based upon assumptions by management
that are subject to known and unknown risks and uncertainties and
other factors that may cause actual results to differ materially from
those expressed or implied by the forward-looking information.
Factors that may cause actual results to vary materially include, but
are not limited to, the failure to satisfy all conditions precedent
within the requisite time, including (without limitation) the
entering into of all necessary definitive agreements, obtaining the
requisite third-party consents and regulatory and shareholder
approvals, and changes in general economic conditions or conditions
in the financial markets. Such forward-looking information is based
on a number of assumptions, including but not limited to, the ability
of the parties to negotiate and enter into definitive agreements, the
parties being satisfied with their respective due diligence
investigations, there are no material changes to the terms of any
proposed transaction, and no significant decline in existing general
business and economic conditions. There can be no assurance that the
Company will be successful in negotiating and entering into all
definitive agreements or that the Option will be exercised, the
Danakil Joint Venture will be formed, the Company's outstanding debt
will be restructured and/or the Company will acquire the new potash
permits. Accordingly, readers should not place undue reliance on
forward-looking information. The Company undertakes no obligations to
update publicly or otherwise revise any forward-looking information,
except as may be required by law. For a more detailed discussion of
such risks and other factors that could cause actual results to
differ materially from those expressed or implied by such
forward-looking statements, refer to the Company's filings with the
Canadian securities regulators available on www.sedar.com. 
Neither the 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. 
Contacts:
Ethiopian Potash Corp.
George Roach
Chief Executive Officer and Director
+44 779 626 3999
george@regentresources.co.za 
Ethiopian Potash Corp.
Michael Galloro
Chief Financial Officer
416 907 5644