Water Ways Closes Qualifying Transaction With Irri-Al-Tal And Completes Capital Raises Totalling Over $3.1M
Water Ways Technologies Inc. (formerly Sagittarius Capital Corporation) (NEX Board: SCX.H) (“Water Ways” or the “Company”), is pleased to announce further to its press releases dated December 31, 2018, August 27, 2018 and June 27, 2018, that it has closed its previously announced Qualifying Transaction (“QT”) with Irri-Al-Tal Ltd. (“IAT”) a company incorporated under the laws of Israel. In addition, aggregate gross proceeds totalling $3,109,570 was raised in connection with the QT, of which $2,818,125 was raised via public offering (“Offering”) of units (“Units”) of Water Ways and $291,445 by way of a private placement (“Concurrent Private Placement”) of units of IAT (“IAT Units”).
Ohad Haber, President, CEO and Director of Water Ways commented: “We are very pleased to announce the completion of the financing and securities exchange with Sagittarius and look forward entering this new chapter of our company. As a global leader in providing innovative irrigation equipment and irrigation turnkey solutions, this financing positions us to pursue opportunities in new markets and new product and service verticals. We also expect that becoming a public company will provide us with additional credibility on the global stage in order to attract additional financing to aggressively accelerate our sales. We thank everyone who made this milestone possible and look forward to demonstrating the full potential of Israeli innovation in the irrigation sector”.
Adam Szweras, Director and Corporate Secretary of Water Ways, and Chairman of the Company’s financial advisor FMI Capital Advisory Inc., added: “Our firm has worked with Water Ways for over a year now and we are excited about the growth prospects in its traditional markets and with legal cannabis and hemp cultivators. We look forward to continue working with management in this new phase of the Company’s existence to seize the opportunity for continued rapid growth”.
The QT provided for the acquisition of all of the outstanding equity interests of IAT by Water Ways in a transaction in which the shareholders of IAT received common shares of Water Ways (the “Common Shares”) and, in case of outstanding convertible securities of IAT, convertible securities of Water Ways. Shareholders of IAT were issued an aggregate of 75,338,152 Common Shares (the “Consideration Shares”) based on the deemed value ascribed to IAT as negotiated between Water Ways and IAT of approximately CAD $18.8 million, at a deemed issue price of CAD$0.25, resulting in 2 Consideration Shares for each one IAT share held. As a result of the QT, Water Ways became the sole beneficial owner of all of the outstanding securities of IAT. Water Ways is the parent company of IAT which will continue its business.
Prior to the QT, Water Ways was a Capital Pool Company (as defined under the policies of the TSX Venture Exchange (the “Exchange”)) and had not commenced commercial operations and had no assets other than cash. The QT constituted Water Ways’ “Qualifying Transaction”, as such term is defined in Policy 2.4 of the Exchange. In connection with the QT the Company’s name was changed from Sagittarius Capital Corporation to Water Ways Technologies Inc. and its shares were consolidated on the basis of one post-consolidation share for every 1.4964285 pre-consolidation shares.
Final acceptance of the QT will occur upon the issuance of a Final Exchange Bulletin by the Exchange. Upon issuance of the Final Exchange Bulletin, Water Ways will cease to be a Capital Pool Company and will recommence trading on the Exchange as a Tier 1 issuer. Subject to this final acceptance, trading in the common shares of Water Ways is expected to begin on the Exchange under the symbol “WWT” shortly. A further press release will be issued when the date trading is anticipated to commence is known.
Public Offering and Concurrent Private Placement
In connection with the QT, Water Ways completed an Offering of 11,272,500 Units for gross proceeds of $2,818,125. Each Unit is comprised of one Common Share and one-half of one common share purchase warrant (each whole warrant, a “Warrant”) of Water Ways at a price of $0.40 per Unit, for a total issuance of 11,272,500 Common Shares and 5,636,250 Warrants. Each Warrant is exercisable into one Common Share (a “Warrant Share”) at $0.40 per Warrant Share until March 6, 2021. If the closing price of the Common Shares on the Exchange is equal to or greater than $0.75 for any 20 consecutive trading days, the Company may, upon providing written notice to the holders of the Warrants, accelerate the expiry date of the Warrants to the date that is 30 days following the date of such written notice.
The Offering was conducted by Leede Jones Gable Inc. (“Leede”) as lead agent and sole bookrunner. As consideration for acting as agent for the Offering, Leede received: (i) a cash commission of $225,450; (ii) a corporate finance fee of $40,000; and (iii) 901,800 non-transferable broker warrants (each, a “Broker Warrant”). Each Broker Warrant entitles the holder to one Common Share at a price of $0.50 until March 6, 2021.
Immediately prior to the closing of the QT, IAT completed a non-brokered Concurrent Private Placement of IAT Units raising gross proceeds of $291,445.38. Each IAT Unit was issued at a price of $0.50 and was comprised of one ordinary share in the capital of IAT and one-half of one ordinary share purchase warrant. Each whole warrant entitled the holder thereof to acquire one ordinary share at a price of $0.80 per share until March 5, 2021. The securities issued in connection with this private placement were converted into Common Shares and warrants of Water Ways, respectively, in connection with the QT with such conversion being completed on the same two to one exchange ratio referenced above.
As a result of the QT and the Offering, Water Ways has 89,410,652 Common Shares issued and outstanding, with 84.3% held by former IAT shareholders (of which 1.3% of the total is attributed to the participants of the Concurrent Private Placement), 3.1% held by shareholders of Water Ways who were shareholders prior to the QT and 12.6% held by purchasers of the Units. In addition there are 11,219,141 common share purchase warrants issued and outstanding, of which 5,636,250 are Warrants held by the participants in Offering, and 5,582,891 are the warrants held by former IAT warrant holders. In addition, there are 1,701,800 broker warrants outstanding, of which 901,800 represents the Broker Warrants and the balance represents the consideration compensation options issued in connection with IAT’s previous financings.
Pursuant to the terms of an escrow agreement among Water Ways, TSX Trust Company and certain escrowed security holders, an aggregate of 60,606,150 Common Shares, 145,872 warrants and 552,714 brokers options have been placed in escrow, which will be released in tranches over the next 18 months, with the first release upon issuance of the Exchange’s Final Exchange Bulletin pursuant to the Tier 1 issuer escrow requirements.
As a result of the closing of the QT, the directors and officers of Water Ways are now:
Ohad Haber – Director and CEO
Meira Zada – CFO
Ronnie Jaegermann – Director
Yehuda Doron – Director
James Lanthier – Director
Adam Szweras – Director and Corporate Secretary
Further details about the QT, the Offering and Water Ways are available in the final prospectus of Water Ways dated December 27, 2018 filed in respect of the QT which has been filed under Water Ways’ profile on SEDAR at www.sedar.com.
Fogler Rubinoff LLP acted as legal counsel to Water Ways, Gowling WLG (Canada) LLP and Adv. Yaniv Bresler (Israel) acted as legal counsel to IAT and Burnet, Duckworth & Palmer LLP acted as legal counsel for Leede.
Ohad Haber, an officer and director of Water Ways, held 28,500,000 IAT ordinary shares. Upon completion of the QT, Mr. Haber now beneficially owns and has control over 57,000,000 Common Shares representing approximately 63.7% of the issued and outstanding Common Shares.
Immediately before the QT, Mr. Haber held, directly or indirectly, beneficial ownership of, or the power to exercise control or direction over, no Common Shares. Immediately after the QT, Mr. Haber held, directly or indirectly, beneficial ownership of, or the power to exercise control or direction over, 57,000,000 Common Shares, representing 63.7% of all of the issued and outstanding common shares of Water Ways.
The Common Shares were acquired for investment purposes. Mr. Haber may increase or reduce his investments in Water Ways according to market conditions or other relevant factors.
The foregoing disclosure regarding Mr. Haber’s holdings is being disseminated pursuant to National Instrument 62-103 The Early Warning System and Related Take-Over Bid and Insider Reporting Issues. A copy of the report to be filed with Canadian securities regulators in connection with the acquisition of these securities can be obtained under Water Ways’ profile on the SEDAR website (www.SEDAR.com) or by contacting the Mr. Haber c/o Meira Zada, email@example.com.
About Water Ways Technologies
Water Ways is the parent company of IAT which is an Israeli based agriculture technology company that specializes in providing water irrigation solutions to agricultural producers. IAT competes in the global irrigation water systems market with a focus on developing solutions with commercial applications in the micro and precision irrigation segments of the overall market. At present, IAT’s main revenue streams are derived from the following business units: (i) Projects Business Unit; and (ii) Component and Equipment Sales Unit. IAT was founded in 2003 by Mr. Ohad Haber with a view of capitalizing on the opportunities presented by micro and smart irrigation, while also making a positive mark on society by making these technologies more widely available, especially in developing markets such as Africa and Latin America. IAT’s past projects include vineyards, water reservoirs, fish farms, fresh produce cooling rooms and more, in over 15 countries.
Certain statements contained in this press release constitute “forward-looking information” as such term is defined in applicable Canadian securities legislation. The words “may”, “would”, “could”, “should”, “potential”, “will”, “seek”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” and similar expressions as they relate to Water Ways, including receipt of the Final Exchange Bulletin and the proposed listing date, are intended to identify forward-looking information. All statements other than statements of historical fact may be forward-looking information. Such statements reflect Water Ways’ current views and intentions with respect to future events, and current information available to Water Ways, and are subject to certain risks, uncertainties and assumptions. Material factors or assumptions were applied in providing forward-looking information, including: the Exchange is satisfied with the final listing materials submitted by Water Ways and issues its Final Exchange Bulletin and approves trading. Many factors could cause the actual results, performance or achievements that may be expressed or implied by such forward-looking information to vary from those described herein should one or more of these risks or uncertainties materialize. Should any factor affect Water Ways in an unexpected manner, or should assumptions underlying the forward-looking information prove incorrect, the actual results or events may differ materially from the results or events predicted. Any such forward-looking information is expressly qualified in its entirety by this cautionary statement. Moreover, Water Ways does not assume responsibility for the accuracy or completeness of such forward-looking information. The forward-looking information included in this press release is made as of the date of this press release and Water Ways undertakes no obligation to publicly update or revise any forward-looking information, other than as required by applicable law. Water Ways’ results and forward-looking information and calculations may be affected by fluctuations in exchange rates. All figures are in Canadian dollars unless otherwise indicated.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
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