Desert Control AS announces that it, pursuant to the strategic review, has entered into an agreement with Holistic Earth Advanced Regeneration Technologies SA (H-EART) to become a licensed operator for production, sales, distribution, and implementation of Liquid Natural Clay (LNC) in the Kingdom of Saudi Arabia (KSA). The agreement marks a significant milestone in Desert Control's transition to a royalty-based licensed operator structure for the Middle East. The change in business model unlocks cash, reduces operating costs, and allows Desert Control to leverage the capacity and reach of local partners while dedicating additional resources to core business activities and accelerating development in the United States and other markets.

H-EART will acquire one LNC production cluster, consisting of 4 LNC production units, for USD 1 million. In addition, H-EART will anchor the strategic partnership by becoming a shareholder in Desert Control AS with an investment of $1 million at NOK 10,- per share in a directed share issue, along with entering into a non-exclusive agreement for the production, sales, distribution, and implementation of LNC in KSA. The strategic partnership with H-EART marks another milestone in Desert Control's strategy to enhance its business model for the Middle East.

The Board of Directors believes the partnership model will enable Desert Control to implement its vision more effectively across the Middle East region with the support of its local partners. Meanwhile, shareholders will benefit from the value creation generated from royalty-based licensing, revenue from asset purchases, and equity infusion. For the initial implementation of the agreement, a total consideration for the combined transactions of USD 2 million will be payable to Desert Control.

During the license period, Desert Control will receive a customary royalty payment calculated as a percentage of revenues from the business of H-EART in KSA. Completion of these agreements is subject to customary terms and conditions.