{"id":212797,"date":"2022-11-22T12:19:51","date_gmt":"2022-11-22T19:19:51","guid":{"rendered":"https:\/\/internationalzeolite.com\/?p=212797"},"modified":"2022-11-22T12:21:25","modified_gmt":"2022-11-22T19:21:25","slug":"international-zeolite-and-cotec-holdings-announce-strategic-alliance","status":"publish","type":"post","link":"https:\/\/internationalzeolite.com\/2022\/11\/22\/international-zeolite-and-cotec-holdings-announce-strategic-alliance\/","title":{"rendered":"International Zeolite and CoTec Holdings Announce Strategic Alliance"},"content":{"rendered":"

– CoTec Holdings Making Anchor Investment to Accelerate Commercialization
\nof International Zeolite\u2019s Revolutionary Proprietary NEREA\u00ae Fertilizer Technology –<\/strong><\/p>\n

Vancouver, British Columbia<\/strong> \u2013 November 22, 2022 \u2013 International Zeolite Corp<\/strong>. (\u201cIZ\u201d) (TSX.V:IZ) (OTCQB: IZCFF) (FSE: ZEON) and CoTec Holdings Corp.<\/strong> (TSXV: CTH) (\u201cCoTec\u201d) are pleased to announce that CoTec has agreed to make a $2 million strategic investment in IZ to support its go-to-market activities in the agricultural and green tech segments.<\/p>\n

CoTec and IZ share similar visions and objectives and are focused on creating a portfolio of green disruptive technologies that are high-margin, eco-friendly and deliver reductions in carbon emissions. The investment from CoTec is expected to fast track IZ\u2019s ability to move rapidly to full commercialization, marketing and sales capabilities for its disruptive agricultural products and solutions. The funding will support the construction of IZ\u2019s first NEREA\u00ae production facility to be in Ontario, Canada with an expected completion date of March 2023. In addition to its financial investment, CoTec will support IZ through the involvement of its management team, who collectively have extensive global reach and expertise in green technologies.<\/p>\n

\u201cWe are excited to partner with IZ and support their efforts to commercialize its proprietary NEREA\u00ae technology,\u201d commented Mr. Julian Treger, CEO of CoTec. \u201cFertilizer is a major contributor to global CO2 emissions and NEREA\u00ae is exactly the type of breakthrough the agricultural industry needs to reduce its carbon footprint – independent studies have shown that it could improve the efficacy of fertilizer by a factor of up to eight and reduce plant and crop growth cycles by as much as twenty-five per cent. Additionally, at a time of conflict in Ukraine, NEREA\u00ae could significantly reduce the Western world\u2019s fertilizer needs and its exposure to higher risk jurisdictions for much needed supply. Our investment will give us a substantial interest in IZ, and we intend to work closely with the IZ management team to help them aggressively roll out this exciting technology.\u201d<\/p>\n

\u201cWe are very pleased to partner with CoTec and are excited to commence the commercialization of NEREA\u00ae products\u201d said Ray Paquette, IZ CEO. \u201cOnce our products are established in Canada, we will roll it out to the other jurisdictions where we have secured exclusivity.\u201d<\/p>\n

NEREA\u00ae<\/strong><\/p>\n

NEREA\u00ae is IZ\u2019s proprietary on demand grow system designed for all agricultural sectors: nurseries, greenhouses, horticultural growers, and outdoor growers. It imbeds into zeolite particles all the macronutrients and micronutrients needed by plants to grow healthy and effectively. It is a demand driven system that allows plants to receive nutrients based on their need and at the time the plant needs it. Independent trials and validation studies show that NEREA\u00ae decreases crop time resulting in additional crops for growers thus increasing grower ROI, reduces the overall requirements for fertilizer by up to 80% resulting in much lower input costs for growers, and reduces greenhouse gases significantly through the reduction of fertilizer consumption. IZ has secured the rights to manufacture, market and sell NEREA\u00ae in Canada and the United States for a period of 20 years from approval of the NEREA\u00ae intellectual property in the relevant jurisdictions and global exclusivity arrangements are pending.<\/p>\n

Transaction Terms<\/strong><\/p>\n

CoTec has signed a subscription agreement to purchase 13,333,334 units (\u201cUnits\u201d) from IZ on a private placement basis at a price of $0.15 per unit for an aggregate subscription of $2,000,0000 (the \u201cPrivate Placement\u201d). King Chapel International (\u201cKings Chapel\u201d), a company associated with Mr. Treger, is also a party to the agreement and will subscribe for 2,000,000 Units, providing IZ with aggregate subscription proceeds of $2,300,000. Each Unit will consist of one common share of the company (each, a “Common Share”) and one common share purchase warrant (each, a “Warrant\u201d).\u00a0 Each Warrant will be exercisable for one Common Share at a price of $0.18 for 12 months from the closing date, which if exercised provides an additional $2,760,000 in operating capital for IZ.<\/p>\n

$170,000 of the net proceeds of the Private Placement will be used to repay shareholder loans owing to Ray Paquette, the CEO of the company, and his affiliates, and the balance will be used to fund the commercialization of NEREA products for manufacturing, marketing and sales in Canada and for working capital purposes.<\/p>\n

Pursuant to the subscription agreement, CoTec and Kings Chapel have each agreed to provide up to $300,000 in bridge loan funding to IZ (together the \u201cBridge Loan\u201d). CoTec agreed to advance its funding concurrently with the execution of the Subscription Agreement and Kings Chapel will advance its Bridge Loan upon the satisfactory completion of its due diligence review of IZ. The Bridge Loan bears interest at 7% per annum and is repayable on the earlier of November 21, 2024, closing of the Private Placement and a change of control of IZ. The Bridge Loan is secured by a first ranking charge in favour of CoTec over all of IZ\u2019s assets. Amounts outstanding under the Bridge Loan will be credited towards the amount payable by CoTec and Kings Chapel upon completion of the Private Placement.<\/p>\n

Upon completion of the Private Placement:<\/p>\n