Alkaline Fuel Cell Power Corp. (NEO: PWWR) (Frankfurt:
77R, WKN: A3CTYF) ("AFCP" or the
"Company"), a company engaged in the development
and production of alkaline fuel cell heat and power systems for
residential, industrial and commercial markets worldwide, is
pleased to announce that it has entered into definitive agreements
to acquire (the "
Transaction") 100% of the
Combined Heat and Power (CHP) generation business (the "
AI
Business") of AI Renewable 2018-I Limited Partnership, AI
Renewable 2020-I Limited Partnership and 2191 Yonge Ltd.
(collectively, “
AI”). AI uses a clean and
renewable single fuel source energy technology that generates both
electricity and heat. The stable and efficient energy production
results in cost savings to the customer and a reduction in
greenhouse gas emissions. Subject to certain closing conditions,
the Company expects to close the Transaction within 30 days from
the date hereof.
Upon closing of the Acquisition, the AI Business will provide
the Company with immediate recurring, long term gross operating
income from a current active account. The AI Business currently has
a pipeline of projects, that once secured, will provide additional
sources of gross operating income. Securing the pipeline of
projects remain subject to mutual agreement with the potential
accounts.
The high efficiency CHP system provides reliable, sustainable
and efficient, on-site energy 24/7. It can be adapted to not only
residential but commercial and industrial customers. Furthermore,
the Company has identified technology that will allow them to
transition the current CHP systems to utilize hydrogen and the AFCP
fuel cells allowing for AFCP to grow exponentially while generating
revenue.
AI's pipeline consists of over 30 potential CHP projects at
various stages of development ranging from proposals, letters of
intent and one power purchase agreement ready to begin the
engineering, procurement and construction (EPC) phase. The
estimated capital investment to bring the pipeline of potential CHP
systems into commercial operation within the next 24-36 months is
estimated at $50,000,000. It is estimated that, based on the CHP
system currently in commercial operation, when all of the potential
CHP systems are in commercial operation, potential gross revenue
could be up to approximately $16.61 million, potential EBITDA could
be up to approximately $7.68 million and potential net income up to
approximately $1.64 million. These estimates are forward-looking
and are subject to the assumptions provided in forward-looking
disclaimer below.
Electricity prices and CO2 emissions associated with
conventional power generation technologies continue to steadily
rise. The need for on site, efficient and reliable energy sources
is ever more apparent. As the market leader in CHP energy
generation there will be an immense opportunity for AFCP to create
further revenue from its fuel cell products by installing systems
in existing locations and selling units to other CHP owners to
secure significant market share of the almost 10,000 high rise
buildings in Canada and 163,000 high rise buildings in major
markets across the globe in the coming years. (Source:
https://www.emporis.com)
“Alkaline Fuel Cell Power Corp. continues to progress towards
commercialization of our micro-combined heat and power
(“Micro-CHP”) system. The integration of AI’s CHP business along
with key members of management will help AFCP accelerate our
milestone timelines and the transition of existing CHP to a clean
zero-emission hydrogen powered energy solution with immediate
revenue and a very large project pipeline, setting the stage for
growth worldwide,” said Mr. Matthew Fish, Interim Chief
Executive Officer of AFCP.
Added Dr. Elliot Strashin, Chairman of AI Renewable, “Our
renewable investment fund, driven by its strong core values, is
committed to investing in clean, green and efficient energy
projects. We are confident that AFCP is the perfect partner to
build off the foundation that AI Renewable has created and assume
our mission of reducing greenhouse gas emissions for meeting
heating and electricity needs across North America.”
Pursuant to the terms of the definitive agreements, the
consideration contemplated for the Transaction (the
"Purchase Price") shall consist of 22,575,758
common shares of Alkaline Fuel Cell Power Corp. (the
"Consideration Shares") and $3,000,000 in cash
consideration. In connection with the execution of the definitive
agreements, the Company advanced a $2,000,000 loan to the vendors,
which will be applied against the cash consideration on closing.
The remaining $1,000,000 cash payment shall be paid no later than
January 2, 2023. As part of the due diligence process, the Company
has retained BDO Canada LLP to prepare a pricing analysis providing
its conclusion of the fair market value of AI. The closing of the
Transaction is subject to completion of satisfactory due-diligence
by the Company and the acceptance of the Transaction by the NEO
Exchange.
In addition to the Purchase Price payable on closing, the
Company shall pay to the vendors additional consideration upon the
achievement of certain milestones described below:
Milestone #1
If the AI Business obtains “Green Loans” and/or government
grants for the AI Business and/or their customers of two million
five hundred thousand ($2,500,000) dollars or more for the
installation of CHP units in buildings within 18 (eighteen) months
following the closing ("Milestone #1"), the
vendors will be compensated with additional common shares in the
capital of the Company (the "Common Shares") equal
to the greater value of 1,000,000 Common Shares or the number of
Common Shares worth one million ($1,000,000) dollars (each a
"Milestone #1 Common Share"), the deemed value of
each Milestone #1 Common Share being the five (5) day volume
weighted average price (the "VWAP") of the common
shares of the Company calculated from the date that the Milestone
#1 payment has been earned.
Milestone #2
If the AI Business signs contracts to install CHP units in
buildings containing not less than 2,000 additional residential
units over a minimum of seven (7) buildings (excluding 2181 Yonge
and 2191 Yonge) within twenty-four (24) month period following the
closing (the "Milestone #2"), the vendors will be
rewarded with additional Common Shares equal to the greater value
of Common Shares worth two million ($2,000,000) dollars or
2,000,000 Common Shares (each a “Milestone #2 Common
Share”). The deemed value of each Milestone #2 Common
Share shall be based on the five (5) days VWAP of the Common Shares
calculated from the date that the Milestone #2 payment has been
earned.
The Consideration Shares, and if issuable, the Milestone #1
Common Shares and Milestone #2 Common Shares will be subject to a
4-month plus one (1) day hold from the date of issuance, in
addition to any applicable NEO Exchange policies and applicable
securities laws.
European Business Update
A press release will be forthcoming regarding the exciting
milestones achieved over the last 6 months in Belgium, and
anticipated ongoing progress towards commercial product viability
as well as the integration benefits with AI Renewable.
Management and Board Changes
The Company is pleased to announce that Dr. Richard Lu has
joined the board of directors. Dr. Lu replaces Mr. Eugene Beukman
who has resigned as a director of the Company.
Dr. Lu has more than 25 years of global experience in the energy
industry developing and implementing business strategies for
organizations in North America, Europe and Asia. He is the
President and CEO of Abundant Solar Energy Inc., an established and
trusted developer, engineer, asset operator, and manager in the
clean and renewable energy space in Canada and the US. He is an
Independent Director at dynaCERT Inc. (DYA.TSE), a growing energy
sector company that specializes in hydrogen application in the
transportation industry. He was the Managing Director of Sky Solar
Holdings Co., Ltd. (SKYS, NASDAQ), and the VP of Business
Development at ARISE Technology Corporation. Dr. Lu also previously
held the position of Chief Conservation Officer and VP of Toronto
Hydro Corporation, where he developed and executed a sweeping
portfolio of Conservation, Demand Management and Distributed Energy
programs and was instrumental in creating an energy conservation
culture in Ontario. Prior to that he was the Vice-President of EHS,
ensuring Toronto Hydro Corporation's commitment to providing a safe
and healthy workplace for employees and the strategies for
achieving sustainable ESG development and growth are successfully
met. Dr. Lu has held senior positions with Enbridge Gas
Distribution, Husky Injection Molding Systems Ltd., and Dillon
Consulting.
The Company also announces that Mr. Matthew Fish has been
appointed the Interim Chief Executive Officer upon the departure of
Mr. Jef Spaepen. Mr. Fish specializes in corporate and securities
law and is the principal of Fish LPC. The Company expresses its
appreciation to Mr. Spaepen for his time with the Company and
wishes him success in his future endeavors.
ABOUT ALKALINE FUEL CELL POWER CORP. The
Company is focused on the development, production and
commercialization of micro-combined heat and power (“micro-CHP”)
systems based on alkaline fuel cell technology. A fuel cell is a
clean electrical power conversion/generation system, akin to small
power stations that provide electricity and an equivalent amount of
heat for various purposes. Based on hydrogen powered alkaline fuel
cell technology, our technology offers an energy source that
generates zero CO 2 emissions with pure water as the only
by-product, making it ideally suited for residential and small- to
medium-sized power markets. We believe Fuel Cell Power is well
positioned to become a positive contributor to the global demand
for clean energy, particularly in Europe where demand outpaces
supply, and current technology remains inadequate to meet market
needs. Further information is available on our website
at https://www.fuelcellpower.com/ and we encourage
investors and other interested stakeholders to follow us
on LinkedIn , Twitter , Facebook , Instagram and YouTube .
Our common shares are listed for trading on the NEO Exchange
(“NEO”) under the symbol “ PWWR ” and on the Frankfurt
Exchange under symbol 77R and WKN A3CTYF .
For further information, please contact:
Matthew FishInterim Chief
Executive Officer+1 (604) 687-2038info@fuelcellpower.com |
Forward-Looking Information This news release
contains forward-looking statements and forward-looking information
within the meaning of applicable securities laws. These statements
relate to future events or future performance. All statements other
than statements of historical fact may be forward-looking
statements or information. In certain cases, forward-looking
statements can be identified by the use of words such as “plans”,
“expects” or “does not expect”, “is expected”, “estimates”,
“forecasts”, “intends”, “anticipates”, “believes” or variations of
such words and phrases or statements that certain actions, events
or results “may”, “could”, “would”, “might”, “occur” or “achieve”.
Forward-looking statements may include, but are not limited to,
statements with respect to the Company’s technology, intellectual
property, business plan, objectives and strategy. Forward-looking
statements and information are provided for the purpose of
providing information about the current expectations and plans of
management of the Company relating to the future, which are subject
to a number of assumptions, risks and uncertainties, many of which
are beyond the control of the Alkaline Fuel Cell Power Corp. Some
assumptions include, without limitation, the assumptions provided
in this news release, the assumption that the results of the
current gross operating income generating CHP unit will be
duplicated for the potential projects in the pipeline; statements
regarding the successful integration of the AI business into the
Company's business in a timely manner; management's ability to
secure potential projects in the pipeline; management's ability to
successfully develop the projects in the pipeline to generate
operating income; management's ability to transition the combined
heat and power technology to a clean zero-emission hydrogen powered
energy solution; the global addressable market for zero-emission
hydrogen powered energy production units; the effectiveness and
timelines to deploy management's business strategy; the renewable
energies sector and the Company’s future plans. Readers are
cautioned that reliance on such statements and information may not
be appropriate for other purposes, such as making investment
decisions. Since forward-looking statements and information address
future events and conditions, by their very nature they involve
inherent risks and uncertainties. Actual results could differ
materially from those currently anticipated due to a number of
factors and risks. Accordingly, readers should not place undue
reliance on the forward-looking statements and information
contained in this news release. Readers are cautioned that the
foregoing list of factors is not exhaustive. The forward-looking
statements and information contained in this news release are made
as of the date hereof and no undertaking is given to update
publicly or revise any forward-looking statements or information,
whether as a result of new information, future events or otherwise,
unless so required by applicable securities laws. The
forward-looking statements or information contained in this news
release are expressly qualified by this cautionary statement.
NEITHER THE NEO EXCHANGE NOR ITS REGULATION SERVICES
PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE NEO
EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF
THIS RELEASE.
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