Eguana Technologies announces ITOCHU’s exercise of warrants

Eguana Technologies (EGTYF) is pleased to announce that ITOCHU Corporation (ITOCY) has purchased 16,666,666 common shares of Eguana through the exercise of share purchase warrants issued in connection with an offering which closed on March 16, 2020 for aggregate consideration of $3,333,333.20. Additionally, ITOCHU and Eguana have agreed to convert $1,145,506.84 of interest owing under the Company’s 7% unsecured convertible debenture into 4,242,617 Common Shares of Eguana in full satisfaction of the interest payment due on March 1, 2023. In connection with the interest conversion, Eguana will issue 4,242,617 Common Shares at a deemed price of $0.27 per share on March 16, 2023. All of the Common Shares will be subject to a four month and one day hold period in accordance with applicable Canadian securities laws. The Conversion remains subject to final approval by the TSX Venture Exchange. As a result of ITOCHU’s status as an insider of the Company, the foregoing interest conversion constitutes a related-party transaction under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions. This transaction is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 pursuant to sections 5.5(a) and 5.7(1)(a) of MI 61-101 as neither the fair market value of the securities issued, nor the consideration provided therefore exceed 25% of the Company’s market capitalization. Immediately prior to the Warrant Exercise and interest conversion, ITOCHU owned or exercised control or direction over 34,013,998 Common Shares and Warrants, representing 8.44% of the total issued and outstanding Common Shares and 16,666,666 common share purchase warrants of Eguana. Immediately following the Warrant Exercise and interest conversion, ITOCHU held 54,923,281 Common Shares, representing 12.95% of the total issued and outstanding Common Shares and no common share purchase warrants of Eguana. When combined with its existing holdings, the conversion in full of the Convertible Debenture would result in ITOCHU holding approximately 24.67% of the Common Shares of the Company. ITOCHU acquired the Common Shares for investment purposes. ITOCHU may from time to time convert the existing securities held by it or acquire additional securities, dispose of some or all of the existing securities held by it, the securities received upon conversion of the existing securities or any additional securities acquired by it or may continue to hold the securities of the Company. The Warrant Exercise did not occur on a stock exchange or other securities market.