Why the price jumped today

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  • Cadiz Inc (NASDAQ: CDZI) stock price rose more than 30% in intraday trading today. That is why.

Cadiz Inc (NASDAQ: CDZI) stock price rose more than 30% in intraday trading today. Investors are responding positively to Cadiz’s announcement that it has entered into a definitive securities purchase agreement for a registered direct offering of 6.86 million common shares at a price of $1.75 per share for total proceeds of $12 million.

The offering is led by the company’s largest shareholder, Heerema International Group Services SA, along with company founder and board member Keith Brackpool and affiliates of the company’s main secured lender, B. Riley Securities.

Proceeds from the offering will be used for working capital purposes and will support ongoing development activities related to Cadiz’s water supply, storage and transmission assets in California.

Heerema IGS, a leading international offshore energy and sustainable solutions company, anchored the offering with an investment of $5 million. And in connection with the purchase of shares under this offering, the company has agreed to provide Heerema with the right to appoint an observer to its board of directors or, in lieu of such observer right , the right to fill a vacancy on its board of directors. Following the Offer, Heerema IGS will beneficially own 35.4% of the outstanding ordinary shares of the company.

Some Cadiz board members, including Cadiz founder Keith Brackpool, invested $2.5 million in the offer. And affiliates of the company’s primary secured lender, B. Riley Securities, also participated in the offering, investing an additional $3.5 million.

The offering is expected to close on March 23, 2022, subject to customary closing conditions. And since this offering is made without an underwriter or placement agent, the company will not pay any discount or underwriting commission in connection with the offering.

KEY QUOTES:

“The persistent drought and water supply problems around the world reinforce our belief that the Cadiz Water Supply, Conservation and Storage Project is one of the most critical water infrastructure projects in the world. western United States and a model for the rest of the world. We support the repurposing of existing gas pipeline assets to transport water as a cornerstone of the company’s plans, and we believe our involvement will greatly help Cadiz to deliver on its mission. Sustainability guides our decision-making processes in all aspects of our business, and we always strive to minimize environmental impact in everything we do. That’s why Cadiz is a perfect match for our investment criteria and we support the company in achieving its objectives.”

— Victor R. Muller, Heerema IGS Board Advisor

“We are proud to have the strong support of our institutional investors, including Heerema IGS, our current shareholders and our lenders in achieving our mission. »

— Susan Kennedy, Executive President of Cadiz

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.

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