MBAC Fertilizer Reports FY2015 Results

TORONTO, ON--(Marketwired - April 28, 2016) - MBAC Fertilizer Corp. ("MBAC" or the "Company") (TSX: MBC) announced today its results for the financial year ended December 31, 2015. All amounts, unless noted, are in U.S. currency.

The Financial Statements and Management Discussion and Analysis ("MD&A") and the Annual Information form (AIF) for the year ended December 31, 2015 are available under the Company's profile at www.sedar.com and from the Company's website, www.mbacfert.com.

2015 HIGHLIGHTS:

• Itafós Arraias SSP Operations continued in care/maintenance mode during 2015, without any SSP production.
  
  
• Zaff LLC ("Zaff") has made senior secured bridge loans of $3.364 million to the Company during the year ended December 31, 2015, carrying an interest rate of 15% per annum. The proceeds have been used primarily to settle outstanding labour claims and to fund general/administrative expenses and preparatory expenses related to a possible resumption of activities.

HIGHLIGHTS SUBSEQUENT TO YEAR END:

• On April 5, 2016, the Company entered into a support agreement (the "Support Agreement") with Zaff, an investment fund active in the fertilizer industry, which has previously provided bridge financing to the Company, to give effect to a recapitalization of the Company. Under the agreement, the Company has agreed to pursue the completion of the Recapitalization pursuant to a plan of compromise and arrangement under the Companies' Creditors Arrangement Act (Canada) and a parallel extrajudicial restructuring proceeding in Brazil under The Bankruptcy Law (11,101/2005), (the "Brazil Proceeding"). Per the terms of the Support Agreement, Zaff will acquire substantially all of the outstanding secured and guaranteed debt of the Company and its Brazilian subsidiaries, as well as certain outstanding unsecured debts of the Company and of the Company's Brazilian subsidiaries that are not guaranteed by the Company. Under the Canadian restructuring, unsecured creditors of the Company will receive either a percentage of their claim in cash or, in the alternative, a combination of (i) restructured debt of MBAC's primary operating subsidiary or (if elected by the applicable creditor) restructured debt of MBAC; and (ii) common shares of MBAC or (if elected by the applicable creditor) share purchase warrants of an MBAC subsidiary exercisable for common shares of MBAC. As a result of the Brazilian Proceeding, certain secured and unsecured creditors of the Brazilian subsidiaries of the Company will receive either cash or, in the alternative, a combination of (i) restructured debt of the respective MBAC Brazilian subsidiary; and (ii) common shares of MBAC or (if elected by the applicable creditor) share purchase warrants. Upon completion of all transactions contemplated by the Support Agreement, Zaff will receive securities representing a controlling interest in the common equity of reorganized MBAC in exchange for the compromise of the acquired debt and the interim working capital financing that has been provided or will be provided to the Company. Subject to certain conditions, Zaff will fund the Company's funding requirements during the term of the Support Agreement, up to a maximum of $5 million. Additionally, MBAC will indirectly acquire all of the shares of GB Minerals Ltd. ("GBL") beneficially held by Zaff in return for common shares of MBAC at a ratio of 2.5 shares of MBAC for each share of GBL so acquired. If the transaction contemplated in and by the Support Agreement is not implemented, the Company may not be able to secure the funding necessary to continue to meet its debt obligations and, in that case, its ability to continue as a going concern would be highly unlikely.