Item 1.01 Entry into a Material Definitive Agreement.
Asset Purchase Agreement
On
The Agreement, among other things, provides for the following:
• The Company will sell all of its right, title and interest in the Assets, as
that term is defined in the Agreement, to the Buyer.
• The purchase price (the "Purchase Price") for the Assets to be sold to the
Buyer is
in cash and in full at closing.
• In accordance with the terms of a separate Escrow Agreement to be entered into
by the parties,$1,000,000 of the Purchase Price will be held in an escrow account for a period of 12 months following the closing to satisfy claims the Buyer may have against the Company under the Agreement.
• The Agreement may be terminated at any time before the Closing Date by (i)
mutual written consent of the parties, (ii) by the Company or the Buyer if there has been a breach by a party of its representations, warranties or covenants that is not timely cured, (iii) by either party in the event all conditions precedent to closing are not satisfied beforeOctober 31, 2020 , or (iv) by either party in the event the Company is unable to obtain shareholder approval of the transactions contemplated by the Agreement on or beforeOctober 31, 2020 .
• The Company may also terminate the Agreement in the event it receives a bona
fide third-party, unsolicited written acquisition proposal that the board of directors reasonably concludes in good faith, after consultation with outside legal counsel, constitutes or would constitute a superior proposal. If the Company elects to exercise this option it shall have to pay to the Buyer the break-up fee described in the Agreement.
• The Company and the Buyer have generally agreed to mutual indemnification for
certain losses incurred in connection with the transactions contemplated by the
Agreement and its ancillary documents.
• The Asset sale is subject to, among other standard closing conditions, approval
by the holders of a majority of the issued and outstanding shares ofWater Now, Inc.'s common stock.
The transaction is expected to close on or before
The Agreement contains representations, warranties and covenants by the parties
and other factual information about the Company, the Buyer and their respective
businesses or operations. The representations, warranties covenants and other
factual statements: (i) have been made solely for the benefit of the other party
or parties to such agreements and amendments; (ii) were made only as of the date
of such agreements and amendments or such other date(s) as expressly set forth
in such agreements or amendments and are subject to more recent developments,
which may not be fully reflected in our public disclosure; (iii) may have been
subject to qualifications with respect to materiality, knowledge and other
matters, which qualifications modify, qualify and create exceptions to the
representations, warranties and covenants in the agreements or amendments; (iv)
may be qualified by disclosures made to such other party or parties in
connection with signing such agreements or amendments, which disclosures contain
information that modifies, qualifies and creates exceptions to the
representations, warranties and covenants in such agreements or amendments; (v)
have been made to reflect the allocation of risk among the parties to such
agreements or amendments rather than establishing matters as facts; and (vi) may
apply materiality standards differentfrom what may be viewed as material to
investors. Accordingly, these representations, warranties, covenants, and
statements of fact should not be relied upon by investors as they may not
describe the Company's actual state of affairs as of
1 Item 8.01 Other Events Post-Closing Expectations
In connection with the transactions described above, the Company expects the following events to occur.
Liquidation of the Company
As soon as practicable after the Closing Date,
Termination of Future Periodic Reporting Obligations
Following the Liquidation Event the Company will no longer have any outstanding
securities registered with the
Press Release
On July
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Item 9.01 Financial Statements and Exhibits.
Pursuant to the rules and regulations of the
Exhibit No. Description of Exhibit
10.1 Asset Sale and Purchase Agreement by and among
99.1 Press Release dated
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Current Report on Form 8-K contains forward-looking statements within the
meaning of federal securities law. Wordssuch as "may," "will," "expect,"
"anticipate," "believe," "estimate," "continue," "predict," "intend," "plan," or
other similar words, identify forward-looking statements. Forward-looking
statements appear in a number of places in this CurrentReport on Form 8-K and
include statements regarding our intent, belief or current expectation about,
among other things, pending transactions, the outcomes of certain transactions,
our financial condition, our ability to pay certain liabilities including the
investment notes, our periodic reporting requirements under federal securities
laws, and our liquidation strategies. Wemay not actually achieve the plans,
intentions, or expectations disclosed in our forward-looking statements, and you
should not place undue reliance on our forward-looking statements. The
forward-looking statements included herein reflect and contain
management'scurrent judgment and assumptions, and involve risks and
uncertainties that could cause actual results, events, and performance to differ
materially from the plans, intentions, and expectations disclosed in the
forward-looking statements. Actual results may differ materially from those
indicated in the forward- looking statements as a result of various factors,
including, but not limited to, those risk factors set forth in Item 1A of Part I
in our Annual Report on Form 10-K for the fiscal year ended
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