Two Rivers Water & Farming Company and WaterVault America, Inc. Announce Definitive Agreement for Sale of HCIC Holdings, LLC.
DENVER, Colorado, April 20, 2020 (GLOBE NEWSWIRE) -- Two Rivers Water & Farming Company (“Two Rivers”) (OTCQB: TURV), a strategic company that acquires, manages and develops the infrastructure of various agricultural industries including land and water rights, and WaterVault America Inc. (“WaterVault”), an unaffiliated, Colorado Public Benefits Corporation, dedicated to creating sustainable economic development in rural communities, today announced that both companies have entered into a Definitive Agreement for WaterVault to acquire water rights of Cucharas Valley No. 05 Dam and Reservoir (“Cucharas Dam”).
Two Rivers has agreed to sell their controlling 94.7% interest in HCIC Holdings, LLC, which owns 5,062 shares of the 132-year-old, mutual benefit company Huerfano-Cucharas Irrigation Company (“HCIC”), a mutual irrigation company and owner of water infrastructure assets and infrastructure rights in Huerfano County, including the Cucharas Dam. Previously, in 2016 Two Rivers’ Board voted to sell Dam Construction Rights to a separate company, Water Redevelopment, and again in July 2019 the Board voted in favor to sell their controlling interest of their HCIC ownership to WaterVault. The transaction is scheduled to be formally closed by end of April.
The Cucharas Dam is located 13 miles northeast of Walsenburg, Colorado on the Cucharas River, and consists of 22 miles of potential shoreline, water rights of 31,958 acre-feet decreed, 34,404 acre-feet conditional, and 41,200 acre-feet of storage rights.
The agreement between the companies consists of WaterVault paying Two Rivers $500,000 cash, and issuing a $1,000,000 line of credit, 6,000,000 shares of common stock and $58,969,000 of preferred stock in WaterVault. WaterVault will assume the related $10,000,000 debt from Two Rivers and is responsible for securing an estimated $40,000,0000 financing for future Cucharas Dam construction obligations.
In January 2019, the Cucharas Dam’s structure was razed by the Colorado State Office of Engineers as a result of insufficient capital needed to comply with reconstruction.
“Since I joined Two Rivers just over 6 months ago, we have been evaluating strategic repositioning of assets and means of securing financing to rebuild the Cucharas Dam and the Orlando reservoirs in Huerfano County, along with the additional infrastructure to be able to maximize those assets and provide storage on both the Cucharas and Huerfano rivers,” said Greg Harrington, CEO of Two Rivers. “I feel that this transaction with WaterVault offers a strong solution to infrastructure needs, strengthens the overall financial condition of Two Rivers, and simultaneously gives our shareholders a level of continued participation in the Cucharas through WaterVault shares.”