Gensource Executes Binding Term Sheet to Develop Potash Properties in Saskatchewan

Gensource Capital Corporation ("Gensource" or the "Company") (TSX VENTURE: GSP)
announces that it has executed a binding term sheet (the "Term Sheet") with
Canada Potash Corp. ("CPC") pursuant to which the skills, people and assets of
CPC and Gensource would be combined to explore and develop potash properties in
the Province of Saskatchewan. CPC is a private resource company engaged in the
exploration and development of potash mineral properties in Saskatchewan,
Canada. 


Under the Term Sheet, Gensource has agreed to issue from its treasury to CPC
that number of shares so that CPC will hold 51% of Gensource's issued and
outstanding shares, in consideration for:




a.  Gensource acquiring from CPC Saskatchewan potash exploration permits
    KP445 and KP437 (the "Permits"); 
    
b.  CPC using reasonable commercial efforts to introduce Gensource to CPC's
    contacts and establish working relationships between Gensource and CPC's
    contacts carrying on business in the fields of: (i) project joint
    ventures; (ii) project finance; (iii) the import and sale of potash
    internationally, including to and within the People's Republic of China
    ("PRC"); and (iv) the shipping or logistics associated with the
    distribution of potash internationally, including to and within the PRC;
    and 
    
c.  CPC using reasonable commercial efforts, to the extent commercially
    practical, to assign to Gensource any contracts or agreements CPC has
    with respect to the matters described in clause (b) above. 



In addition, on closing, provided that CPC holds not less than 20% of
Gensource's issued and outstanding common shares:




i.  CPC will have the right to nominate four individuals for election to a
    seven member board of directors of Gensource, and the board will jointly
    appoint one of CPC's nominees as Chairman. 
    
ii. CPC will vote all of its shares of Gensource in favour of Gensource's
    three nominees to the Board provided that the principal focus of
    Gensource's business and operations remains the exploration, development
    or mining of potash properties in the Province of Saskatchewan. 



Closing is subject to certain conditions including:



--  completion of due diligence, satisfactory to each of Gensource and CPC
    in their sole discretion; 
    
--  receipt of all required approvals, including approval of Gensource
    shareholders and approval of the TSX Venture Exchange; 
    
--  execution of a shareholder's agreement between CPC and Gensource (the
    "Shareholder's Agreement"); 
    
--  no material adverse change in respect of Gensource or the Permits; 
    
--  delivery of title opinions in respect of the Permits and Gensource's
    Lothar and Lazlo potash projects; and 
    
--  other conditions as are customary for transactions of this nature to be
    set out in a definitive share subscription and exploration permit
    purchase agreement to be entered into between the parties (the
    "Subscription and Purchase Agreement"). 



The parties have agreed to use their commercially reasonable efforts and act in
good faith to complete their respective due diligence and to execute the
Subscription and Purchase Agreement within 30 days.


Gensource and CPC have agreed to work exclusively through Gensource to advance
the exploration, development, mining and marketing of potash from properties in
the Province of Saskatchewan, except for those projects currently held by CPC
(other than the Permits).


CPC has agreed to use its commercially reasonable efforts to assist Gensource to
arrange: (i) project joint ventures; (ii) debt and equity project finance; (iii)
the import and sale of potash from Gensource's properties internationally,
including to and within the PRC; and (iv) the shipping or logistics associated
with the distribution of potash internationally, including to and within the PRC
- to the extent that such arrangements cannot be achieved through the contacts
and assigned agreements provided by CPC to Gensource pursuant to the
Subscription and Purchase Agreement.


The execution of the Subscription and Purchase Agreement and the Shareholder's
Agreement are not a condition precedent to the Term Sheet or the respective
obligations of CPC and Gensource contained in the Term Sheet. 


The Term Sheet and the Subscription and Purchase Agreement will be terminated if
the transaction has not closed within 120 days.


Mike Ferguson, CEO of Gensource, commented: "Gensource is very pleased to
announce this agreement to align and combine business efforts between our two
companies. Gensource's business model requires that all three required pillars
that support a successful project be in place as early as possible in the
project development cycle. Those pillars are market access, financial capacity
and execution expertise. This proposed transaction will put all three of those
pillars in place and that will clear the way for efficient and focused project
development with the goal to put one or more projects into production in the
coming years."


Under the Term Sheet, Mike Ferguson will continue in his role as CEO of the
Company. Mike Ferguson is a professional engineer with over 25 years experience
in potash and uranium mining projects in Saskatchewan. Mike graduated from the
University of Saskatchewan with a B.Sc. in Mechanical Engineering. Following a
few years spent with the Canadian Military, Mike settled back in Saskatoon and
has spent his entire mining career in Saskatchewan participating in projects in
potash, uranium, gold and base metals. His experience ranges from working at the
mining face behind a Marietta Miner in a potash operations, to in-plant
engineering (both surface plant and underground), engineering management,
project management through to general management of engineering and EPCM
companies. Most recently, Mike successfully led the Potash One project team
responsible for the development of the Legacy Project in Southern Saskatchewan
from initial exploration through scoping-, pre-feasibility- and feasibility
studies and an approved EIS, to the point where it was acquired by the
international potash producer K+S Group of Germany. Mike brings to Gensource not
only his experience in the potash industry but also the unique experience of
leading the development of a greenfield potash property in Saskatchewan - the
first such project to be developed in over 40 years.


The Company will issue a subsequent press release providing further information
regarding the transaction as required by the policies of the TSX Venture
Exchange.


Trading of the shares of the Company on the TSX Venture Exchange will remain
halted until the Company has satisfied all of the requirements of the TSX
Venture Exchange necessary to reinstate trading.


About Gensource

Gensource Capital Corporation is based in Saskatoon, Saskatchewan and is focused
on developing resource opportunities with a specific focus on potash
development. The Company's primary project is its wholly-owned subsidiary,
Gensource Potash Corporation, also based in Saskatoon Saskatchewan. Gensource
Potash Corporation is led by Mike Ferguson P.Eng., President and CEO. Mr.
Ferguson has assembled a world class management team with direct and specific
interest in potash development.


About Canada Potash

Canada Potash Corporation (CPC) is based in Saskatoon, Saskatchewan with
operating offices in Vancouver, British Columbia as well as representative
offices in Beijing, Shanghai and Hong Kong in China. CPC owns 10 potash permits
encompassing approximately 3000 square kilometers in Saskatchewan and its
primary objective is the development of potash mines and the extraction of high
grade sylvite minerals.


Completion of the transaction is subject to a number of conditions, including
TSX Venture Exchange acceptance and disinterested shareholder approval. The
transaction cannot close until the required Shareholder approval is obtained.
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 applicable disclosure
document to be prepared in connection with the transaction, any information
released or received with respect to the transaction may not be accurate or
complete and should not be relied upon. Trading in the securities of Gensource
should be considered highly speculative. 


The TSX Venture Exchange has in no way passed upon the merits of the proposed
transaction and has neither approved nor disapproved the contents of this press
release.


This news release contains forward-looking statements, including statements
regarding the completion of the transaction and the Company's goals. These
statements are based on certain factors and assumptions, including expected
growth, results of operations, performance and business prospects and
opportunities. While the Company considers these factors and assumptions to be
reasonable based on information currently available, they may prove to be
incorrect. A number of factors could cause actual results to differ materially
from those in the forward-looking statements, including, but not limited to
results of exploration and project development, and the Company's financial
condition and prospects could differ materially from those currently anticipated
in such statements for many reasons such as: changes in general economic
conditions and conditions in the financial markets; changes in demand and prices
for minerals; litigation, legislative, environmental and other judicial,
regulatory, political and competitive developments; technological and
operational difficulties encountered in connection with the activities of the
Company. Additional risks and uncertainties can be found in our Management's
Discussion and Analysis and in filings with the Canadian provincial securities
commissions. Forward-looking statements are given only as at the date of this
news release and the Company disclaims any obligation to update or revise the
forward-looking statements, whether as a result of new information, future
events or otherwise. 


Neither 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.


FOR FURTHER INFORMATION PLEASE CONTACT: 
Gensource Capital Corporation
Mike Ferguson
CEO
(306) 974-6414
mike@gensource.ca
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