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Hanfeng signs letter of intent with Nu-Gro to license technology for the first SCU fertilizer plant in China TSX Symbol: HF TORONTO, Oct. 12 /CNW/ - Hanfeng Evergreen Inc. ("Hanfeng" or the "Company"), is pleased to announce that it has entered into a non-binding letter of intent ("LOI") with The Nu-Gro Corporation ("Nu-Gro") that will enable the Company to establish the first Sulfur Coated Urea ("SCU") Plant in China and further reduce its cost per tonne for slow-release fertilizers. The LOI sets out the proposal made by Nu-Gro to enter into an exclusive (for China) Technology and Know-how License Agreement with Hanfeng that will enable the Company to engineer, design, procure, construct, and operate a 90,000 metric tonne per year SCU Plant. Hanfeng opened its first slow-release fertilizer blending plant in Shanghai in late April 2004, and significantly reduced costs by blending SCU raw material, supplied by Nu-Gro and imported from Canada, with other raw materials to produce a range of slow-release fertilizer products in China for local customers. Since then, Hanfeng has generated more than $3 million in orders for slow-release fertilizers in five months, a 500% increase from sales of $450,000 in 2003. By establishing the first SCU plant in China, Hanfeng will garner further cost savings and enhance its first mover and technology advantages. "We have been building our relationship with Nu-Gro since signing our first distribution agreement in 2001 and recognize that Nu-Gro's SCU technology offers the best blend of low production costs and high-quality slow-release fertilizer products available now," said Xinduo Yu, CEO & President of Hanfeng. "China is the largest consumer of fertilizers and has serious environmental and efficiency problems. Both the government and industry have recognized that the application of slow-release fertilizers is the only effective approach to solve water contamination and increase nitrogen efficiency." "This agreement is a great way for Nu-Gro to participate in the growth of China's slow-release fertilizer market," said John Hill, President of Nu-Gro. "Our SCU technology and Hanfeng's market expertise in China are a winning combination." About Hanfeng Evergreen Hanfeng Evergreen Inc. is a leading innovator in the growing market for urban greening and high value agricultural products and services in China. The Company supplies specialty slow-release fertilizers, ornamental trees and tree seeds that it produces in China and through exclusive distribution agreements with leading North American suppliers. Hanfeng also provides integrated landscaping services for city lands, parks and real estate developments. About The Nu-Gro Corporation The Nu-Gro Corporation (www.nu-gro.com) is a subsidiary of United Industries Corporation, which goes to market as Spectrum Brands (www.spectrumbrands.com). Spectrum Brands is a leading manufacturer and marketer of value-oriented products for the consumer lawn and garden care, household pest control, and pet supplies segment in North America. Spectrum Brands household brands include Hot Shot(R), Cutter(R) and Repel(R). The company's lawn and garden brands include Spectracide(R), Garden Safe(R) and Real-Kill(R) in the controls category as well as Sta-Green(R), Vigoro(R), Schultz(TM), Peters(R), Bandini(R) and Best(R) brands in the lawn and garden fertilizer and organic growing media categories. Through its Canadian subsidiary, Nu-Gro, manufactures and markets category-leading brands such as CIL(R), Wilson(R), So-Green(R), and Green Earth(R). The company is also a leading global supplier of slow release nitrogen and other fertilizer technologies under brand names such as Nitroform(R) and Nutralene(R). Spectrum Brands is headquartered in St. Louis, Missouri. (Bloomberg Symbol: 14496Z) This press release contains forward-looking statements based on current expectations. These forward-looking statements entail various risks and uncertainties that could cause actual results to differ materially from those reflected in these forward-looking statements. Risks and uncertainties about the Company's business are more fully discussed in Hanfeng's materials, including its annual and interim MD&A, filed with the securities regulatory authorities in Canada from time to time. For further information: Kim Oishi, Vice President, Corporate Finance, Hanfeng Evergreen Inc., Phone: [phone], Fax: [phone], [e-mail]; Jay Hussey, Investor Relations, The Equicom Group Inc., Phone: [phone] ext. 225, Fax: [phone], [e-mail]