Edgewater Closes First Tranche of $0.115 Financing and Announces Increase to $0.13 Financing

Rhea-AI Summary

Edgewater Wireless Systems (KPIFF) has successfully closed the first tranche of its non-brokered private placement, raising $726,387 by issuing 6,316,405 units. Each unit comprises one common share and one warrant, allowing purchase at $0.23 over 24 months. The second tranche is expected to close on April 1, 2021, aiming for approximately $75,000. Additionally, the company plans to increase its Secondary Offering from 10,153,847 to up to 11,000,000 units, targeting $1,430,000. Funds will primarily support operating expenses, engineering, product development, and working capital.

Positive

• Raised $726,387 in first tranche of private placement.
• Strong demand for the second tranche and Secondary Offering, indicating investor confidence.
• Allocation of funds to crucial areas: $446,000 for operating expenses, $1,226,500 for engineering and product development.

Negative

• Potential dilution of shares could impact existing shareholder value.
• Dependence on future market conditions to realize anticipated proceeds.

Edgewater Wireless Systems Inc. (YFI: TSX.V) (OTCQB: KPIFF), the industry leader in Wi-Fi Spectrum Slicing technology for residential and commercial markets, is pleased to announce that the first tranche of its non-brokered private placement announced on March 12, 2021 (the “Offering”) has closed. In the first tranche closing the Company issued 6,316,405 units (each a “Unit”) for total proceeds of $726,387. Each Unit is comprised of one common share and one warrant of the Company (each a “Warrant”). Each Warrant entitles the holder to acquire one additional common share of the Company at a price of $0.23 for twenty-four (24) months following the closing of the Offering.

It is anticipated that the second tranche of the Offering, for aggregate proceeds of approximately $75,000, will close on April 1, 2021.

The Company also anticipates closing its additional offering of units (the “Secondary Units”) at a price of $0.13 per Secondary Unit (the “Secondary Offering”) on April 1, 2021. Due to exceptional demand, the Secondary Offering has been increased from the 10,153,847 Secondary Units announced in the Company’s news release dated March 18, 2021 [9,230,770 Secondary Units plus a 10% (923,077 unit) over-allotment option] to up to 11,000,000 Secondary Units for aggregate gross proceeds of up to $1,430,000. Each Secondary Unit is comprised of one common share and one warrant of the Company (each a “Secondary Warrant”). Each Secondary Warrant entitles the holder to acquire one additional common share of the Company at a price of $0.23 for twenty-four (24) months following the closing of the Secondary Offering.

“Demand for our recently announced private placements has exceeded supply,” said Andrew Skafel, President and CEO of Edgewater Wireless. “Management and Directors will participate in this second offering, in addition to the first.”

Finder’s fees of 7% of the gross proceeds of the Offering and Secondary Offering may be payable in cash. In addition, finders may receive share purchase warrants (the “Finder’s Warrants”) entitling them to purchase that number of common shares of the Company which is equal to 7% of the total number of Units and Secondary Units purchased by subscribers introduced to the Company by such finders, exercisable for two years from the closing of the Offering or Secondary Offering, as applicable, at a price of $0.23 per common share, all in accordance with the policies of the TSXV.

In connection with the closing of the first tranche of the Offering, the Company will pay cash finders’ fees in the aggregate of $33,563 as follows: $23,905 to Haywood Securities Inc. / $2,012 to Leede Jones Gable Inc. / $644 to Canaccord Genuity Corp. / $7,002 to Granger Cumberford. In addition, the Company will issue 291,854 Finders’ Warrants as follows: 207,869 to Haywood Securities Inc. / 17,500 to Leede Jones Gable Inc. / 5,600 to Canaccord Genuity Corp. / 60,885 to Granger Cumberford.

The common shares issued in connection with the first tranche of the Offering and any common shares purchased on the exercise of the attached Warrants will be subject to a four-month hold period expiring July 31, 2021. The common shares issued in connection with the second tranche of the Offering and the common shares issued in connection with the Secondary Offering, and any common shares purchased on the exercise of the attached Warrants or Secondary Warrants, as applicable, will be subject to a four-month hold period from the closing of the Secondary Offering.

The Offering and Secondary Offering are subject to TSXV acceptance. It is intended that the proceeds of $2,230,000 from the Offering and the Secondary Offering will be used for: Operating Expenses, including sales, marketing and business development ($446,000); Engineering and Product Development ($1,226,500) and Working Capital ($557,500). The Company may reallocate the proceeds from the Offering as may be required depending upon the development of the Company’s business.

In connection with the Offering and the Secondary Offering, the Company will issue Units and Secondary Units to directors, officers and insiders of the Company. As a result, the Offering and Secondary Offering will constitute a related party transaction pursuant to TSX Venture Exchange Policy 5.9 and Multilateral Instrument 61-101 (“MI 61-101”). The Company has determined that exemptions from the various requirements of TSX Venture Exchange Policy 5.9 and MI 61-101 are available for the issuance of the Units and Secondary Units to related parties. The Company is relying on Section 5.5(c) of MI 61-101 for an exemption from the formal valuation requirement on the basis that the transaction is a distribution of securities for cash, and on Section 5.7(1)(b) of MI 61-101 for an exemption from the minority shareholder approval requirement, as the fair market value of the transaction, insofar as it involves related parties, will not be more than $2,500,000.

About Edgewater Wireless

We make Wi-Fi. Better.

Edgewater Wireless (www.edgewaterwireless.com) is the industry leader in innovative Spectrum Slicing technology for residential and commercial markets. We develop advanced Wi-Fi silicon solutions, Access Points, and IP licensing designed to meet the high-density and high quality-of-service needs of service providers and their customers. With 24+ patents, Edgewater’s Multi-Channel, Single Radio (MCSR) technology revolutionizes Wi-Fi, delivering next-generation Wi-Fi today.

For more information, visit www.edgewaterwireless.com or www.aera.io.

Forward-Looking Statements

This news release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking information or statements. Although Edgewater Wireless believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward looking statements and information because Edgewater Wireless can give no assurance that they will prove to be correct. By its nature, such forward-looking information is subject to various risks and uncertainties, which could cause Edgewater Wireless’ actual results and experience to differ materially from the anticipated results or expectations expressed. These risks and uncertainties, include, but are not limited to access to capital markets, market forces, competition from new and existing companies and regulatory conditions. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date it is expressed in this news release or otherwise, and to not use future-oriented information or financial outlooks for anything other than their intended purpose. Edgewater Wireless undertakes no obligation to update publicly or revise any forward looking information, whether as a result of new information, future events or otherwise, except as required by law.

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

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FAQ

What is the total amount raised in Edgewater Wireless' first tranche of private placement?

Edgewater Wireless raised $726,387 in the first tranche of its private placement.

When is the second tranche of Edgewater Wireless' private placement expected to close?

The second tranche is expected to close on April 1, 2021.

What will the proceeds from the Offering and Secondary Offering be used for?

The proceeds will be used for operating expenses, engineering and product development, and working capital.

What is the price of the secondary units offered by Edgewater Wireless?

The secondary units are offered at a price of $0.13 per unit.

How many secondary units are Edgewater Wireless planning to offer?

Edgewater Wireless plans to offer up to 11,000,000 secondary units due to high demand.