Fengro Industries Corp. Announces Closing of $410,000 Financing

VANCOUVER, JANUARY 22, 2020 - Fengro Industries Corp. (TSXV:FGR) ("Fengro" or "the Company") announces that it has received final approval from the TSXV and has closed funds of $410,000 of the previously announced (see news release of November 5, 2019) non-brokered private placement financing of common shares for $0.005 per common share (the "Placement"). All securities issued in this Placement will have a resale restriction hold period of 4 months and one day. The hold period will end on May 23, 2020.

The Company must complete a minimum 10:1 consolidation of its common shares as part of the TSXV approval of the Placement, prior to the TSXV lifting the current trading halt. The completion of the consolidation will occur irrespective of the completion of the previously announced (November 5, 2019) potential RTO with Elemental Royalties Limited (the"Transaction").

No finders fees have been paid in connection with the Placement.

The majority of the proceeds of the Placement will be used to repay existing Company trade creditors (including legal, accounting, marketing, regulatory, various general accrued working capital and accrued employee costs). The Placement will significantly reduce its working capital deficit.


Control Persons

As a result of the closing, there will be two new control persons created - John Robins and James Paterson - each holding 26.505% of the issued and outstanding common shares.

Arms-length shareholder written approval of the new control persons has been received - the creation of new control persons requires a minimum of 50% and one common share of the currently issued and outstanding shares.

Tembo Capital is subscribing for $60,000 of the Placement, and as an existing approved Control Person will see its ownership reduced to 36.076%. Tembo's participation is permitted under the Policy 5.9, MI 61-101 exemption with Tembo participating for less than 25% of the Company's market capitalisation.


Update on Sale of Brazilian Assets

The previously announced disposition of the Company's Brazilian assets to Geofoscal Comercio, Industria, Representacoes e Transporte de Produtos Agropecuarios Ltda. was approved at the Company's shareholders meeting on October 18, 2019. The Company anticipates that the transaction will close in or about January 22, 2020.


On behalf of Fengro Industries Corp.

Giles Baynham
Chief Executive Officer and Director



For more information contact:

Fengro Industries Corp.
Email: info@fengro.com
+1 (604) 764 6126



FORWARD LOOKING STATEMENTS

Certain information contained in this press release constitutes "forward-looking information", within the meaning of applicable Canadian securities legislation. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "aims", "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "target", "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 Fengro, the proposed terms and anticipated completion of the private placement, and the proposed terms and condition of the definitive agreement, and the anticipated completion of the Transaction. 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 Fengro 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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