Potash One and Potash North Announce Business Combination

Potash One Inc. ("Potash One") (TSX:KCL) and Potash North Resource Corporation
("Potash North") (TSX VENTURE:PON) are pleased to announce that they have
entered into a binding letter of intent ("LOI") containing the principal terms
by which, subject to satisfaction of certain conditions, Potash One will acquire
all of the issued and outstanding common shares of Potash North through a Plan
of Arrangement or other form of business combination (the "Business
Combination").


The LOI contemplates that each Potash North shareholder will receive 0.3125
common shares of Potash One for each common share of Potash North. In addition,
all outstanding convertible securities of Potash North will be exchanged for
comparable convertible securities of Potash One in an amount and at exercise
prices adjusted in accordance with the same exchange ratio. The exchange ratio
represents an approximate 29% premium for the shares of Potash North over the
20-trading day period prior to the execution of the LOI.


There are currently 65,745,002 Potash North common shares issued and
outstanding, 2,750,000 outstanding options to purchase Potash North common
shares, 38,672,000 Potash North common shares issuable pursuant to outstanding
share purchase warrants and an additional 5,000,000 common shares and 5,000,000
common share purchase warrants issuable pursuant to an outstanding unsecured
convertible note. Potash One owns 7,583,850 common shares of Potash North which
represents 11.5% of the currently outstanding shares of Potash North and an
additional 7,583,850 share purchase warrants.


Certain shareholders including Potash One and all the directors and officers of
Potash North have agreed to vote their shares in favour of the Business
Combination.


The Business Combination will require the approval of Potash North
securityholders, the Toronto Stock Exchange and the TSX Venture Exchange, and
will be subject to other customary conditions, including the execution of a
definitive agreement and completion of due diligence.


The LOI provides that Potash North shall not, directly or indirectly, solicit,
initiate or encourage letter of intent offers from, or negotiations with, any
third party with respect to any other potential merger or acquisition of all or
a material portion of Potash North's business, assets or outstanding securities
except where required to satisfy fiduciary obligations of directors. Potash
North and Potash One have both agreed to pay a non-completion fee of $2.5
million under certain circumstances. The transaction is expected to close by May
15, 2009.


The Business Combination, once completed, will create one of the strongest
junior potash development companies in Canada. Potash One will be fully funded
through to completion of feasibility on its solution mining amenable potash
development property located in southern Saskatchewan (the "Legacy Project").
Current cash of the resulting company would be approximately $50 million.


Paul F. Matysek, President and CEO of Potash One, stated, "I am very pleased
that Potash One has been able to execute this binding LOI with Potash North as
this transaction strengthens our balance sheet, further consolidates the potash
junior industry and positions the company with over 500,000 acres of subsurface
Potash permit holdings, in Saskatchewan. This includes a very prospective
exploration stage potash property adjacent to the largest potash mine in the
world. In addition, we are pleased to have the support of a number of
significant shareholders who together with our present shareholders are
committed to the continued development and progress of the Legacy Project. This
Business Combination further strengthens our exploration and development
position in the Potash industry, bringing us closer to our goal of becoming the
first greenfield potash producer in Canada in decades."


Craig A Angus, President and CEO of Potash North, stated; "I am very excited
with the opportunity that this transaction presents to our shareholders. As a
result of the turmoil in world capital markets, it is increasingly apparent that
the successful companies in the junior potash space will be those that have
large cash treasuries and advanced stage projects moving toward feasibility and
development. This business combination will create the best capitalized Canadian
Junior potash development company working in the Saskatchewan basin. Our
shareholders will have the opportunity to participate in the advancement of the
Legacy Project to completion of feasibility and potentially through to
production in the coming years while maintaining the exploration exposure to our
KP 416 and 417 Permit areas near Esterhazy."


Canaccord Capital Corporation has acted as advisor to an independent committee
of the Board of Directors of Potash North and has provided to such independent
committee of Potash North their verbal advice, subject to final review of
documentation, that the consideration offered pursuant to the transaction is
fair, from a financial point of view, to the shareholders of Potash North, other
than Potash One.


Information on Potash One and Potash North may be viewed on the internet at
their respective websites noted below, or at the Canadian securities regulator's
website at www.sedar.com.


(1) Legacy Project: Potash One is a TSX listed Canadian resource company engaged
in the exploration and development of advanced potash properties amenable to
solution mining. The Company owns 100% of more than 330,000 acres of contiguous
Potash Subsurface Exploration Permits in Saskatchewan. It includes the 97,240
acre Legacy Project which has a 43-101 compliant Inferred Mineral Resource of
391.5 million tonnes of K20 and Indicated Mineral Resource of 40.8 million
tonnes of K20 and is adjacent to the largest producing solution mine in the
world.


Cautionary Statements Regarding the Business Combination: Completion of the
transaction is subject to a number of conditions, including regulatory approval,
shareholder approvals, completion of satisfactory due diligence, a definitive
agreement and approval of the British Columbia Supreme Court. There can be no
assurance that the transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the Management Information
Circular to be prepared in connection with the transaction, any information
released or received with respect to the business combination may not be
accurate or complete and should not be relied upon. Trading in the securities of
exploration and development stage resource companies should be considered highly
speculative.


Forward-Looking Statements: Statements in this release that are forward-looking
statements are subject to various risks and uncertainties concerning the
specific factors disclosed under the heading "Risk Factors" and elsewhere in the
corporations' periodic filings with Canadian Securities Regulators. Such
information contained herein represents management's best judgment as of the
date hereof based on information currently available. Statements in this press
release other than purely historical information, including statements relating
to the companies' future plans and objectives or expected results, constitute
forward-looking statements. Forward looking statements are based on numerous
assumptions and are subject to all of the risks and uncertainties inherent in
the companies' business, including risks inherent in mineral exploration and
development. The companies do not assume the obligation to update any
forward-looking statement. In particular, no representation is made in this
release as to the timing of the business combination, whether the business
combination will complete on the terms described herein or at all, the success
or value of the combined companies after the business combination. In addition,
there are numerous risks and other factors that will influence a development
decision, including concluding resource evaluations on mineral properties, mine
design limitations, permitting risks and economic factors, all of which may be
beyond our control.


U.S. Cautionary Statements: We advise US investors that while the terms
"measured resources", "indicated resources" and "inferred resources" are
recognized and required by Canadian regulations, the US Securities and Exchange
Commission does not recognize these terms. US investors are cautioned not to
assume that any part or all of the material in these categories will ever be
converted into reserves.
Potash North Resource (Tier2) (TSXV:PON)
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