/THIS PRESS RELEASE IS INTENDED FOR
DISTRIBUTION IN CANADA ONLY AND IS
NOT INTENDED FOR DISTRIBUTION TO UNITED
STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES./
PHOENIX, AZ, April 28, 2016 /CNW/ - GWR Global Water Resources
Corp. (TSX: GWR) (the "Company") announced today that it has
obtained a final court order approving the previously announced
arrangement of the Company (the "Arrangement") under the
Business Corporations Act (British
Columbia). The Arrangement was approved by shareholders of
the Company at an annual and special meeting held on April 25, 2016. At the effective time of the
Arrangement, the Company will merge with and into Global Water
Resources, Inc. ("GWRI") and, as a result, the Company will cease
to exist as a British Columbia
corporation and GWRI, governed under the laws of the State of Delaware, will be the surviving
entity of the merger.
GWRI also announced today that it has priced its initial public
offering of 1,164,800 shares of common stock at U.S.$6.25 per share for gross proceeds of
U.S$7,280,000 (the "U.S. IPO"). In
addition, GWRI has granted the underwriter of the U.S. IPO a 30-day
over-allotment option to purchase up to an additional 174,720
shares of common stock on the same terms and conditions. GWRI
intends to use the net proceeds from the U.S. IPO for working
capital and other general corporate purposes.
The Arrangement and the U.S. IPO are cross-conditional and will
only be completed concurrently. Subject to the satisfaction of
customary conditions, the Arrangement and the U.S. IPO are expected
to close on May 3, 2016. On
completion of the Arrangement and the U.S. IPO, all of the shares
of common stock of GWRI will be listed on the Toronto Stock
Exchange under the trading symbol "GWR" and on the NASDAQ Global
Market under the trading symbol "GWRS", subject to the satisfaction
of applicable listing requirements.
As described in the Company's meeting circular that was sent to
shareholders of the Company in connection with the Arrangement, the
merger of the Company with and into GWRI may give rise to Canadian
and U.S. tax liabilities to the Company and therefore to GWRI. The
amount of the potential tax that may be payable by GWRI as a
consequence of the merger will depend on a number of factors that
cannot be predicted with certainty at this time, including in
particular the fair market value of the shares of common stock of
GWRI held by the Company at the time of the consummation of the
merger scheduled for May 3, 2016.
Using the trading price of the shares of common stock of GWRI as a
rough approximation for the fair market value of the shares of
common stock of GWRI, the Company estimates that a trading price at
the time of the closing of the merger of US$6.00 per GWRI share would result in aggregate
U.S. and Canadian tax liabilities to GWRI of approximately
US$160,000, a trading price at the
time of the closing of the merger of US$6.50 per GWRI share would result in aggregate
U.S. and Canadian tax liabilities to GWRI of approximately
US$1,900,000, a trading price of
US$7.00 per GWRI share would result
in aggregate U.S. and Canadian tax liabilities to GWRI of
approximately US$3,500,000, and a
trading price of US$7.50 per GWRI
share would result in aggregate U.S. and Canadian tax liabilities
to the Company of approximately US$5,800,000. The Company does not believe that
tax liabilities at the levels described above would result in a
material adverse effect to GWRI.
This press release shall not constitute an offer to sell or a
solicitation of an offer to buy, nor will there be any sale of
securities in any state or jurisdiction (including any province or
territory of Canada) in which such
an offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
state or jurisdiction.
About GWR Global Water Resources Corp.
The Company was
incorporated in British Columbia
to acquire shares of U.S. based GWRI and to actively participate in
the management, business and operations of GWRI through its
representation on the board of directors of GWRI and its shared
management of GWRI. GWRI is a water resources company located in
Phoenix, Arizona, that owns and
operates regulated water, wastewater and recycled water utilities
in the metropolitan Phoenix
area.
Cautionary Note Regarding Forward-Looking
Statements
This press release includes certain
forward-looking statements. These forward-looking statements
include, but are not limited to the expected timing and completion
of the Arrangement and the U.S. IPO and the estimated tax
liabilities resulting from the merger, that are not historical
facts as well as statements identified by words such as "expects",
"anticipates", "intends", "plans", "believes", "seeks",
"estimates", or the negative of these terms, or other words of
similar meaning. These statements are based on our current beliefs
or expectations and are inherently subject to significant
uncertainties and changes in circumstances, many of which are
beyond our control. Actual results may differ materially from these
expectations due to changes in global political, economic,
business, competitive, market and regulatory factors and other
factors discussed under the heading "Risk Factors" in the Company's
most recent Annual Information Form. We undertake no obligation to
publicly update any forward-looking statement, except as required
by law, whether as a result of new information, future developments
or otherwise.
SOURCE GWR Global Water Resources Corp.