Flow Beverage Corp. Completes Private Placement

Rhea-AI Summary

Flow Beverage Corp. (FLWBF) has completed a non-brokered private placement, raising gross proceeds of $1,812,440 through the issuance of 6,473,000 subordinate voting shares at a price of $0.28 per share to a single investor. The gross proceeds will be used for working capital and general corporate purposes. The company has also entered into a subscription agreement with the investor for additional shares. The offering remains subject to final approval of the Toronto Stock Exchange. Prior to the offering, NFS Leasing Canada Ltd. and Clifford L. Rucker owned warrants convertible into SV Shares. After the offering, the investor and Clifford L. Rucker will own a significant percentage of the company's shares. The SV Shares were acquired for investment purposes, and the investor may acquire additional shares or dispose of its SV Shares or warrants based on various factors.

Positive

• Successful completion of a non-brokered private placement raising $1,812,440
• Proceeds to be used for working capital and general corporate purposes
• Entered into a subscription agreement for additional shares

Negative

• The investor and Clifford L. Rucker will own a significant percentage of the company's shares after the offering
• The investor may acquire additional shares or dispose of its SV Shares or warrants based on various factors

TORONTO--(BUSINESS WIRE)-- Flow Beverage Corp. (TSX:FLOW; OTCQX:FLWBF) (“Flow” or the “Company”) is pleased to announce it has completed a non-brokered private placement (the “Offering”), raising gross proceeds of $1,812,440 through the issuance of 6,473,000 subordinate voting shares (“SV Shares”) at a price of $0.28 per SV Share, to a single investor, RI Flow LLC (the “Investor”).

All SV Shares issued under the Offering are subject to a four-month and one-day hold period in accordance with applicable Canadian securities laws and such other further restrictions as may apply under applicable foreign securities laws. The Offering remains subject to the final approval of the Toronto Stock Exchange (“TSX”).

The gross proceeds from the Offering will be used by the Company for working capital and general corporate purposes.

Flow has also entered into a subscription agreement with the Investor pursuant to which the Investor has agreed to acquire an additional 5,577,000 SV Shares at a price of $0.28 per SV Share for additional gross proceeds of $1,561,560, subject to satisfaction of certain conditions including the approval of the TSX (the “Second Offering”).

This news release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities offered have not been and will not be registered under the United States Securities Act of 1933, as amended, U.S. Securities Act or under any U.S. state securities laws, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons, absent registration or an applicable exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws.

Early Warning Disclosure

Prior to the Offering, NFS Leasing Canada Ltd., (“NFS Canada”) owned, and Clifford L. Rucker and NFS Leasing, Inc. (“NFS”) beneficially owned, or had control or direction over, warrants convertible into 6,126,880 SV Shares (the “Warrants”), representing approximately 10.64% of the issued and outstanding SV Shares and 5.12% of the voting rights attached to all of the Company’s outstanding voting securities, on a partially diluted basis (based upon 51,454,684 SV Shares and 6,214,566 multiple voting shares of the Company (the “MVS”) outstanding prior to giving effect to the Offering, each of which MVS entitles the holder to the voting rights of ten SV Shares).

After giving effect to the Offering, the Investor owns, and Clifford L. Rucker beneficially owns, or has control or direction over, 6,473,000 SV Shares and Warrants convertible into 6,126,880 SV Shares, representing, on an undiluted basis, 11.17% of the issued and outstanding SV Shares and 5.39% of the voting rights attached to all of the Company’s outstanding voting securities, and representing, on a partially diluted basis (assuming exercise of the Warrants), 19.67% of the issued and outstanding SV Shares and 9.98% of the voting rights attached to all of the Company’s outstanding voting securities (all based upon 57,927,684 SV Shares and 6,214,566 MVS outstanding after giving effect to the Offering). Assuming the completion of the Second Offering, the Investor will own, and Clifford L. Rucker will beneficially own, or have control or direction over, 12,050,000 SV Shares and Warrants convertible into 6,126,880 SV Shares, representing, on an undiluted basis, 18.97% of the issued and outstanding SV Shares and 9.59% of the voting rights attached to all of the Company’s outstanding voting securities, and representing, on a partially diluted basis (assuming exercise of the Warrants), 26.10% of the issued and outstanding SV Shares and 13.79% of the voting rights attached to all of the Company’s outstanding voting securities (all based upon 63,504,684 SV Shares and 6,214,566 MVS outstanding after giving effect to the Offering and the Second Offering).

Other Information

The SV Shares were acquired for investment purposes. Subject to various factors including, without limitation, Flow’s financial position, the price of SV Shares, market conditions, Clifford L. Rucker’s determinations from time to time as to whether the trading price of the SV Shares adequately reflects the value of the SV Shares in relation to the Company’s activities and future prospects, and other factors and conditions Clifford L. Rucker deems appropriate, the Investor (or an affiliate or associate thereof) may acquire additional SV Shares, including pursuant to the Second Offering, or may dispose of any or all of its SV Shares or Warrants, from time to time through, among other things, the exercise of the Warrants and the purchase or sale of SV Shares on the open market or in private transactions or otherwise, on such terms and at such times as Clifford L. Rucker may deem advisable.

The Company’s head office is located at 155 Industrial Parkway South, Unit 7-10, Aurora, Ontario L4G 3G6; the Investor and Mr. Rucker are located at 500 Cummings Center, Suite 6050, Beverly, MA 01915; and NFS and NFS Canada are located at 900 Cummings Center, Suite 226-U, Beverly, MA 01915.

A copy of the report filed under applicable Canadian securities laws by the Investor in connection with the transactions referred to in this press release may be obtained from the Investor via email: legal@ruckerinv.com or telephone 774 233 8421, or on the SEDAR profile of the Company at: www.sedarplus.ca.

About Flow Beverage Corp.

Flow is one of the fastest-growing premium water companies in North America. Founded in 2014, Flow’s mission since day one has been to reduce environmental impacts by providing sustainably sourced naturally alkaline spring water in a recyclable and up to 75% renewable, plant-based pack. Today, the brand is B-Corp Certified with a best-in-class score of 126.5, offering a diversified line of health and wellness-oriented beverage products: original naturally alkaline spring water, award-winning organic flavours, collagen-infused and vitamin-infused flavours in sizes ranging from 330-ml to 1-litre. All products contain naturally occurring electrolytes and essential minerals and support Flow’s overarching purpose to "bring wellness to the world through the positive power of water." Flow beverage products are available online at flowhydration.com and are sold at over 59,500 stores across North America.

For more information on Flow, please visit Flow’s investor relations site at: investors.flowhydration.com.

Forward-Looking Statements

This press release contains forward-looking information and forward-looking statements within the meaning of applicable securities laws (“Forward-Looking Statements”). The Forward-Looking Statements contained in this press release relate to future events or Flow’s future plans, operations, strategy, performance or financial position, including statements regarding the Second Offering, and are based on Flow’s current expectations, estimates, projections, beliefs and assumptions. Such Forward-Looking Statements have been made by Flow in light of the information available to it at the time the statements were made and reflect its experience and perception of historical trends. All statements and information other than historical fact may be forward‐looking statements. Such Forward‐Looking Statements are often, but not always, identified by the use of words such as “may”, “would”, “should”, “could”, “expect”, “intend”, “estimate”, “anticipate”, “plan”, “foresee”, “believe”, “continue”, “expect”, “believe”, “anticipate”, “estimate”, “will”, “potential”, “proposed” and other similar words and expressions.

Forward-Looking Statements are based on certain expectations and assumptions and are subject to known and unknown risks and uncertainties and other factors, many of which are beyond Flow’s control, that could cause actual events, results, performance and achievements to differ materially from those anticipated in these Forward-Looking Statements. Forward-Looking Statements are provided for the purposes of assisting the reader in understanding Flow and its business, operations, prospects, and risks at a point in time in the context of historical and possible future developments, and the reader is therefore cautioned that such information may not be appropriate for other purposes. Forward-Looking Statements should not be read as guarantees of future performance or results. Readers are cautioned not to place undue reliance on these Forward-Looking Statements, which speak only as of the date of this press release. Unless otherwise noted or the context otherwise indicates, the Forward-Looking Statements contained herein are provided as of the date hereof, and the Company disclaims any intention or obligation, except to the extent required by law, to update or revise any Forward-Looking Statements as a result of new information or future events, or for any other reason.

This press release should be read in conjunction with the management’s discussion and analysis (“MD&A”) and consolidated financial statements and notes thereto as at and for the year ended October 31, 2023. Additional information about Flow is available on the Company’s profile on SEDAR+ at www.sedarplus.ca, including the Company’s Annual Information Form for the year ended October 31, 2023 dated January 29, 2024.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240130339967/en/

Trent MacDonald, Chief Financial Officer

1-844-356-9426

investors@flowhydration.com

Investors:

Marc Charbin

investors@flowhydration.com

Media:

Natasha Koifman

nk@nkpr.net

Source: Flow Beverage Corp.

FAQ

What is the ticker symbol for Flow Beverage Corp.?

The ticker symbol for Flow Beverage Corp. is FLWBF.

How much was raised through the non-brokered private placement?

Flow Beverage Corp. raised $1,812,440 through the non-brokered private placement.

What is the price per subordinate voting share in the private placement?

The price per subordinate voting share in the private placement was $0.28.

What will the gross proceeds be used for?

The gross proceeds will be used for working capital and general corporate purposes.

What is the status of the offering?

The offering remains subject to the final approval of the Toronto Stock Exchange.

Who will own a significant percentage of the company's shares after the offering?

The investor and Clifford L. Rucker will own a significant percentage of the company's shares after the offering.