In a news release, Eguana Technologies Inc. (EGT:TSX.V; EGTYF:OTCQB) advised that it has closed the previously announced $5 million strategic investment in the company by Japan's Itochu Corp. (ITOCY:OTCMKTS; 8001:JP). The firm indicated that the investment was structured as unsecured convertible debentures and that proceeds from the financing will be allocated to fund working capital and general corporate expenditures.
Eguana Technologies' CEO Justin Holland commented, "The Moixa GridShare AI integration and testing with our Eguana Evolve is on schedule to complete later this month and will be available for field trials in April. The new product will open additional third-party ownership and fleet aggregation channels through our strategic partnership with Itochu...We will also begin transitioning the battery supply chain over to Itochu which will further reduce up front working capital requirements and bring consistency to our battery module availability as we continue to ramp up operations and clear back logged orders in Hawaii, California, and South Australia."
The firm noted that Itochu is one of Japan's leading sogo shosha (general trading companies) and presently has around 110 offices in 63 countries. The firm conducts import/export activities and domestic and overseas trading of textiles, machinery, metals, minerals, energy, chemicals, food, general products, realty, information and communications technology, and finance. The company also invests in businesses in both Japan and overseas.
Eguana Technologies is a designer and manufacturer of high performance residential and commercial energy storage systems. The company, which is headquartered in Calgary, Alberta Canada, reported that "it has two decades of experience delivering grid edge power electronics for fuel cell, photovoltaic and battery applications, and delivers proven, durable, high quality solutions from its high capacity manufacturing facilities in Europe and North America."
The firm noted that it has deployed thousands of its proprietary energy storage inverters in Europe and North America and that it is one of the leading suppliers of power controls for solar self-consumption, grid services and demand charge applications at the grid edge.
According to the terms of the investment agreement, the debentures have a coupon of 10% per annum and will mature and be repayable on March 13, 2023. The company stated that the principal amount, together with accrued interest in certain circumstances, may be convertible into units of the company at a price of $0.15 per unit and that if all of the debentures and warrants are converted and exercised Itochu would own a 14.0% equity interest in Eguana on a fully diluted basis.
Upon closing the transaction, the two companies additionally entered into an amended marketing agreement whereby Itochu will procure and supply Eguana with the lithium batteries required for making Eguana's products.
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