9, respectively.Certain risks, uncertainties, and other factors are incorporated herein by reference to our most recent Annual Report on Form 10-K, and our subsequent Quarterly Reports on Form 10-Q, along with the other information contained in this prospectus, as updated by our subsequent filings under the Securities Exchange Act of 1934, as amended, (the "Exchange Act").or the “Exchange Act.” Except as otherwise required by applicable securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances, or any other reason, after the date of this prospectus.
AVAILABLE INFORMATION
PROSPECTUS SUMMARY
About Cadiz
We are a water solutions provider dedicated to delivering clean, reliable, and affordable water for people through a variety of innovative water supply, storage, conveyance and treatment projects. We are advancing human access to clean water with our unique combination of land, water, infrastructure and technology assets, cutting-edge innovation, and industry-leading standards of environmental stewardship.
We own approximately 46,000 acres of land with access to high-quality, naturally-recharging groundwater resources in three areas of Southern California’s Mojave Desert – the Cadiz Valley (35,000 acres), Danby Dry Lake (2,000 acres), and the Piute Valley (9,000 acres). Our land holdings with vested water rights were primarily assembled by our founders in the early 1980s, relying on NASA imagery that identified a unique desert aquifer system at the base of a vast Southern California watershed. This watershed underlying our property in the Cadiz Valley (“Cadiz Ranch”) presently holds 17-34 million acre-feet of groundwater in storage – comparable in size to the largest reservoir in the United States, Lake Mead. The aquifer system is part of a closed-basin watershed in which all water flows downgradient to desert playas where it evaporates at the surface forming what are known as “desert dry lakes.”
Water Supply – We own vested water rights to withdraw 2.5 million acre-feet of groundwater to support farming and off property uses. Because all groundwater in the aquifer system will eventually be lost to evaporation, surplus groundwater that is captured and withdrawn before it evaporates is a new water supply known as “conserved” water. We have completed extensive environmental review in accordance with local, state and federal laws authorizing the management of the groundwater aquifer underlying the Cadiz Ranch to conserve an average of 50,000 acre-feet of water per year for 50 years for use in communities.
Groundwater Storage - The alluvium aquifer that lies beneath the property in the Cadiz Valley is also large enough for conjunctive use as a water “banking” facility, capable of storing an additional 1 million acre-feet of imported surplus water for delivery during drought periods.
Pipeline Conveyance – We also own a 30” steel natural gas pipeline (“Northern Pipeline”) that extends 220-miles from the Cadiz Ranch across Kern and San Bernardino Counties terminating in California’s Central Valley. The pipeline, originally constructed to transport fossil fuels, is idle, and we are presently preparing to convert the pipeline to transport water. The route of the Northern Pipeline intersects three water conveyance facilities that deliver water to Southern California, the California Aqueduct, the Los Angeles Aqueduct, and the Mojave River Pipeline. The capacity of the Northern Pipeline for water conveyance is 25,000 (“AFY”).
We also hold a 99-year lease with the Arizona & California Railroad to co-locate and construct a 43-mile approximately 55-85” steel water conveyance pipeline (“Southern Pipeline”) within the existing, active railroad right-of-way that intersects the Colorado River Aqueduct, one of Southern California’s primary sources of drinking water. The capacity of the Southern Pipeline ranges from 75,000 AFY to 150,000 AFY depending on the pipeline diameter selected to accommodate imported water storage.
We are currently in discussions with multiple public water agencies to enter into agreements whereby project participating agencies would finance and operate the Northern Pipeline and lease 25,000 AFY of annual water supply from us. In accordance with such potential agreements, we expect that we will contribute the Northern Pipeline and an annual supply of 25,000 AFY of water from us into a mutual water company to be owned jointly by the parties. In such event, we expect that a joint power authority (“JPA”) comprised of participating agencies will be able to purchase, for a 40-year term (take or pay), 25,000 AFY of water at our wellhead at an agreed upon market price estimated to start at approximately $850/AFY and subject to annual adjustment. Through a JPA, the informational requirementspublic water agencies would fund capital costs for conversion of the pipeline from gas to water, construction of pumping stations and appurtenant facilities, and would be able to seek infrastructure funding and grants to achieve their lowest possible cost for delivered water. Any contracts and off take facility construction will be subject to standard environmental review and a project level permitting process. We expect that similar agreements will be negotiated and entered into for water supplies and storage delivered via the Southern Pipeline.
Treatment - In the fourth quarter of 2022, we completed the acquisition of the assets of ATEC Systems, Inc. into a wholly-owned subsidiary of the Company named ATEC Water Systems, LLC (“ATEC”), which provides innovative water filtration solutions for impaired or contaminated groundwater sources. ATEC’s specialized filtration media provides cost-effective, high-rate of removal for common groundwater impairments and contaminants that pose health risks in drinking water including iron, manganese, arsenic, Chromium-6, nitrates, and other constituents of concern.
Our agricultural operations provide our current principal source of revenue, although our working capital needs are not fully supported by our agricultural lease and farming returns at this time. We believe that our water supply, storage, pipeline conveyance and treatment solutions will provide a significant source of future cash flow for the business and our stockholders. We presently rely upon debt and equity financing to support our working capital needs and development of our water solutions. In February 2023, we completed a direct offering for net proceeds of $38 million led by our largest equity shareholders to fund capital expenditures to accelerate the development of water supply, storage and conveyance infrastructure, reduce our outstanding debt from $50 million to $35 million and provide working capital to the Company.
Our current and future operations also include activities that further our commitments to sustainable stewardship of our land and water resources, good governance and corporate social responsibility. We believe these commitments are important investments that will assist in maintenance of sustained stockholder value.
Corporate Information
We are a Delaware corporation with our principal executive offices located at 550 South Hope Street, Suite 2850, Los Angeles, California 90071. Our telephone number is (213) 271-1600. We maintain a corporate website at www.cadizinc.com. Our website address provided in this prospectus supplement is not intended to function as a hyperlink and the information on our website is not, nor should it be considered, part of this prospectus supplement or accompanying prospectus, or incorporated by reference herein or therein.
Amendment to Credit Agreement
On February 2, 2023, we and our wholly-owned subsidiary, Cadiz Real Estate LLC, as borrowers (collectively, the “Borrowers”) entered into a First Amendment to Credit Agreement with BRF Finance and B. Riley Securities, Inc. (“BRS”), as administrative agent, to amend certain provisions of the Credit Agreement dated as of July 2, 2021, among the Borrowers, BRF Finance and the other lenders from time to time party thereto, and BRS, as administrative agent for the lenders, including the following:
| ● | The lenders will have a right to convert from time to time a Convertible Loan into shares of our common stock at a conversion price of $4.80 per share (the “Conversion Price”). The Convertible Loan may comprise up to $15 million of outstanding principal, plus any PIK Interest (as defined below) and any accrued and unpaid interest under the Credit Agreement. The lenders’ right to convert is conditioned upon our obtaining stockholder approval of an amendment to our certificate of incorporation to increase the number of authorized shares of our common stock at our next annual meeting of stockholders, expected to be held in June 2023 (the “Stockholder Approval”). In addition, we have agreed to provide the lenders with registration rights for resale of the shares issuable upon conversion of the Convertible Loan. |
| ● | Prior to the maturity of the Credit Agreement, we will have the right to require that the lenders convert the outstanding principal amount, plus any PIK Interest and accrued and unpaid interest, of the Convertible Loan if the following conditions are met: (i) the average VWAP of our common stock on The Nasdaq Stock Market, or such other national securities exchange on which the shares of common stock are listed for trading, over 30 consecutive trading dates exceeds 115% of the then Conversion Price, (ii) a registration statement registering the resale of the shares issuable upon conversion of the Convertible Loan has been declared effective by the SEC, (iii) the Stockholder Approval has been obtained, and (iv) there is no event of default under certain provisions of the Credit Agreement. |
| ● | The maturity date of the Credit Agreement will be initially extended from July 2, 2024 to June 30, 2025. Upon obtaining the Stockholder Approval and so long as there is no event of default under certain provisions of the Credit Agreement, the maturity date for the Credit Agreement will automatically be extended to June 30, 2026. |
| ● | The annual interest rate will remain unchanged at 7.00%. Interest on $20 million of the principal amount will continue to be paid in cash. Interest on the $15 million principal amount of the Convertible Loan will be paid in kind on a quarterly basis by adding such amount to the outstanding principal amount of the outstanding Convertible Loan (“PIK Interest”). |
Summary of Offering
| Common stock offered by the selling stockholders | 3,971,870 shares of common stock, issuable to the selling stockholders upon conversion of up to $15 million of outstanding principal and any accrued and unpaid interest under the Convertible Loan. |
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| Use of proceeds | We will not receive any of the proceeds from the sale of the shares by any of the selling stockholders. |
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| Nasdaq Global Market symbol | “CDZI” |
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| Risk Factors | See “Risk Factors” beginning on page5 and other information in this prospectus for a discussion of factors you should consider carefully before investing in shares of our common stock. |
RISK FACTORS
An investment in our securities involves a high degree of risk. Certain risks relating to us and our business are described under the headings “Business” and “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the Commission on March 30, 2023, which is incorporated by reference into this prospectus and any accompanying prospectus supplement and which you should carefully review and consider, along with the other information contained in this prospectus and any accompanying prospectus supplement or incorporated by reference herein, as updated by our subsequent filings under the Exchange Act, before making an investment in any of our securities.
Additional risks, as well as updates or changes to the risks described in the documents incorporated by reference herein, may be included in any applicable prospectus supplement. Prior to making a decision to invest in our securities you should consider carefully the specific factors discussed under the capitation “Risk Factors” in the applicable prospectus supplement, together with any other information contained in the applicable prospectus supplement or appearing or incorporated by reference in this prospectus. In addition, please read the section of this prospectus captioned “Special Note Regarding Forward-Looking Statements,” in which we describe additional uncertainties associated with our business and the forward-looking statements included or incorporated by reference in this prospectus. Please note that additional risks not presently known to us or that we currently deem immaterial may also impair our business and operations.
Investment in any securities offered pursuant to this prospectus involves risks and uncertainties. If one or more of the events discussed in the risk factors were to occur, our business, financial condition, results of operations or liquidity, as well as the value of an investment in our securities, could be materially adversely affected.
USE OF PROCEEDS
We will not receive any proceeds from the sale of any or all of the shares being offered by the selling stockholders under this prospectus. Our obligations to pay amounts otherwise due under the Credit Agreement will, however, be reduced as a result of the issuance of our common stock in conversion of the Convertible Loan.
SELLING STOCKHOLDERS
The common stock being offered by the selling stockholders consists of up to 3,971,870 shares of our common stock issuable upon conversion of the Convertible Loan under the Credit Agreement, see “Prospectus Summary— Amendment to Credit Agreement” above. When we refer to the “selling stockholders” in this prospectus, or, if required, a post-effective amendment to the registration statement of which this prospectus is a part, we mean the selling stockholders, as well as any of its pledgees, assignees and successors-in-interest. The selling stockholders may sell all, some or none of the shares of common stock subject to this prospectus. See “Plan of Distribution” below as it may be supplemented and amended from time to time.
The selling stockholders, BRF Finance, is a lender under the Credit Agreement, and its affiliate, BRS, acted as the agent under the Credit Agreement. Additionally, BRS has acted as our placement, underwriter or sales agent in prior securities offerings, in connection with which BRS and its affiliates has acquired our securities. Other than these relationships, the selling stockholders have not had any material relationship within the past three years with us or any of our affiliates.
Under the terms of the Credit Agreement, we may not effect the conversion of the Convertible Loan (a “Borrower Conversion”), and the selling stockholders will not be entitled to request the conversion of the Convertible Loan (a “Lender Conversion”), until we obtain the Stockholder Approval. Further, no Lender Conversion or Borrower Conversion shall be effected, if, upon giving effect to such conversion, the aggregate number of shares of our common stock beneficially owned by a selling stockholder (together with its affiliates, any other persons acting as a group together with such selling stockholder or any of the selling stockholder’s affiliates, and any other persons whose beneficial ownership of our common stock would or could be aggregated with the holder’s for purposes of Section 13(d) or Section 16 of the Exchange Act) would exceed the Beneficial Ownership Limitation, which is 4.99% of the number of shares of common stock outstanding immediately after giving effect to any conversion, as such percentage ownership is calculated in accordance with Section 13(d) of the Exchange Act and the applicable regulations of the SEC. Each selling stockholder may reset the Beneficial Ownership Limitation percentage to a higher percentage (not to exceed 9.9%), effective 61 days after written notice to us.
The information in the table below with respect to the selling stockholders has been obtained from the selling stockholders and sets forth, to our knowledge, information concerning the beneficial ownership of shares of our common stock by the selling stockholders. Beneficial ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to our common stock. Generally, a person “beneficially owns” shares of our common stock if the person has or shares with others the right to vote those shares or to dispose of them, or if the person has the right to acquire voting or disposition rights with respect to such shares within 60 days. Except as otherwise noted herein, the number of shares beneficially owned by the selling stockholders identified in this table is as of May 10, 2023. The inclusion of any shares in this table does not constitute an admission of beneficial ownership by the selling stockholders.
| | | Shares of
Common
Stock
Beneficially
Owned
Prior to
Offering | | | Maximum
Number of
Shares of
Common Stock
to be Sold
Pursuant to
this | | | Number of Shares of
Common Stock Owned After
Offering | |
| Name of Selling stockholders | | Number | | | Prospectus(1) | | | Number | | | Percentage | |
| BRF Finance Co., LLC (2)(5) | | | 2,985,935 | | | | 1,985,935 | | | | 1,000,000 | | | | 1.4 | % |
| 272 Capital Master Fund Ltd. (3)(5) | | | 1,687,094 | | | | 1,066,394 | | | | 620,699 | | | | 0.9 | % |
| BRC Partners Opportunity Fund, L.P. (4)(5) | | | 919,541 | | | | 919,541 | | | | - | | | | - | % |
| (1) | The number of shares of our common stock in the column “Maximum Number of Shares of Common Stock to be Sold Pursuant to this Prospectus” represents all of the shares of our common stock that the selling stockholders may offer and sell from time to time under this prospectus without giving effect to the Beneficial Ownership Limitation described above. |
| (2) | The shares reported under “Shares of Common Stock Beneficially Owned Prior to Offering” consist of (i)1,985,935 shares of common stock issuable to BRF Finance upon conversion of the Convertible Loan (assuming the Stockholder Approval has been obtained), and (ii) 1,000,000 shares of common stock issuable upon exercise of warrants owned by B. Riley Principal Investments, LLC; provided, however, that the ability of BRF Finance to convert the Convertible Loan is subject to the Beneficial Ownership Limitation as described above. Both BRF Finance and B. Riley Principal Investments, LLC are wholly owned subsidiaries of B. Riley Financial, Inc. Bryant Riley is the Co-Chief Executive Officer and Chairman of the Board of Directors of B. Riley Financial, Inc. As a result, Mr. Riley may be deemed to indirectly beneficially own the shares reported in this note. The business address of Mr. Riley, B. Riley Financial, Inc., BRF Finance and B. Riley Principal Investment, LLC is 11100 Santa Monica Blvd. Suite 800, Los Angeles, CA 90025. |
| (3) | The shares reported under “Shares of Common Stock Beneficially Owned Prior to Offering” (i) consist of 1,066,394 shares of common stock issuable to 272 Capital Master Fund Ltd. (“272 Capital”) upon conversion of the Convertible Loan (assuming the Stockholder Approval has been obtained) owned by 272 Capital and 620,699 shares of common stock owned by 272 Capital, and (ii) exclude 919,541 shares of common stock issuable to BRC Partners Opportunity Fund, L.P. (“BRC Partners”) upon conversion of the Convertible Loan (assuming the Stockholder Approval has been obtained) owned by BRC Partners; provided, however, that the ability of 272 Capital to convert the Convertible Loan is subject to the Beneficial Ownership Limitation as described above. 272 Advisors LLC is a majority-owned subsidiary of B. Riley Capital Management, LLC (“BRCM”) and is the general partner of 272 Capital. BRC Partners Management GP, LLC is a wholly-owned subsidiary of BRCM and is the general partner of BRC Partners. BRCM has engaged B. Riley Asset Management, LLC as the “sub-advisor”, which has the full trading discretion, voting and dispositive power over 272 Capital and BRC Partners’ investments. Wesley Cummins is the President of B. Riley Asset Management, LLC. As a result, Mr. Cummins may be deemed to indirectly beneficially own the shares reported in this note. The business address of Mr. Cummins, B. Riley Asset Management, LLC, 272 Capital and BRC Partners is 11100 Santa Monica Blvd. Suite 800, Los Angeles, CA 90025. |
| (4) | The shares reported under “Shares of Common Stock Beneficially Owned Prior to Offering” (i) consist of 919,541 shares of common stock issuable to BRC Partners upon conversion of the Convertible Loan (assuming the Stockholder Approval has been obtained) owned by BRC Partners and (ii) exclude 1,066,394 shares of common stock issuable to 272 Capital upon conversion of the Convertible Loan (assuming the Stockholder Approval has been obtained) owned by 272 Capital and 620,699 shares of common stock owned by 272 Capital; provided, however, that the ability of BRC Partners to convert the Convertible Loan is subject to the Beneficial Ownership Limitation as described above. 272 Advisors LLC is a majority-owned subsidiary of BRCM and is the general partner of 272 Capital. BRC Partners Management GP, LLC is a wholly-owned subsidiary of BRCM and is the general partner of BRC Partners. BRCM has engaged B. Riley Asset Management, LLC as the “sub-advisor”, which has the full trading discretion, voting and dispositive power over 272 Capital and BRC Partners’ investments. Wesley Cummins is the President of B. Riley Asset Management, LLC. As a result, Mr. Cummins may be deemed to indirectly beneficially own the shares reported in this note. The business address of Mr. Cummins, B. Riley Asset Management, LLC, 272 Capital and BRC Partners is 11100 Santa Monica Blvd. Suite 800, Los Angeles, CA 90025. |
| (5) | Under the Credit Agreement, the selling stockholders may convert any outstanding loan amount into depositary receipts representing interests in the Company’s 8.875% Series A Cumulative Perpetual Preferred Stock (the “Depositary Shares”) at the per share exchange price of $25.00, subject to a timeline provided in the Credit Agreement. The Depositary Shares will be converted into shares of common stock if, and only if, a Change of Control (leading to a de-listing) or a Delisting Event (each as defined in the applicable Certificate of Designation) has occurred. |
PLAN OF DISTRIBUTION
The shares of common stock offered by this prospectus will be offered and sold by the selling stockholders named in this prospectus. We have agreed to bear the expenses of the registration of the shares, including legal and accounting fees, other than fees of counsel, if any, retained by the selling stockholders, or any discounts or commissions payable with respect to sales of the shares.
The selling stockholders will act independently of us in making decisions with respect to the timing, manner and size of each sale. Such sales may be made on one or more exchanges or in the over-the-counter market or otherwise, at prices and under terms then prevailing or at prices related to the then current market price or in negotiated transactions. The selling stockholders may sell their shares by one or more of, or a combination of, the following methods:
| ● | purchases by a broker-dealer as principal and resale by such broker-dealer for its own account pursuant to this prospectus; |
| ● | ordinary brokerage transactions and transactions in which the broker solicits purchasers; |
| ● | block trades in which the broker-dealer so engaged will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction; |
| ● | on any national securities exchange or quotation service on which the shares may be listed or quoted at the time of sale; |
| ● | in the over-the-counter market; |
| ● | in privately negotiated transactions; |
| ● | in options transactions; and |
| ● | by any other legally available means. |
In addition, any shares that qualify for sale pursuant to Rule 144 may be sold under Rule 144 rather than pursuant to this prospectus.
From time to time, a selling stockholder may pledge or grant a security interest in some or all of the shares which the selling stockholder owns. If a selling stockholder defaults in the performance of such selling stockholder’s secured obligations, the pledgees or secured parties may offer and sell the shares from time to time by this prospectus (except, in some cases, if the pledgees or secured parties are broker-dealers or are affiliated with broker-dealers). A selling stockholder also may transfer and donate shares in other circumstances. Donees may also offer and sell the shares from time to time by this prospectus (except, in some cases, if the donees are broker-dealers or are affiliated with broker-dealers). The number of shares beneficially owned by a selling stockholder will decrease as and when such selling stockholder donates such selling stockholder’s shares or defaults in performing obligations secured by such selling stockholder’s shares. The plan of distribution for the shares offered and sold under this prospectus will otherwise remain unchanged, except that the donees, pledgees, other secured parties or other successors in interest will be selling stockholders for purposes of this prospectus.
To the extent required, this prospectus may be amended or supplemented from time to time to describe a specific plan of distribution.
In effecting sales, broker-dealers or agents engaged by the selling stockholders may arrange for other broker-dealers to participate. Broker-dealers or agents may receive commissions, discounts or concessions from the selling stockholders in amounts to be negotiated immediately prior to the sale.
The selling stockholders and any broker-dealers acting in connection with the sale of the shares covered by this prospectus may be deemed to be “underwriters” within the meaning of Section 2(11) of the Securities Act of 1933, as amended (the “Securities Act”), and any commissions received by them and any profit realized by them on the resale of the shares as principals may be deemed to be underwriting compensation under the Securities Act.
In order to comply with the securities laws of certain states, if applicable, the shares must be sold in such jurisdictions only through registered or licensed brokers or dealers. In addition, in certain states, the shares may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.
We have agreed to indemnify the selling stockholders against liabilities they may incur as a result of any untrue statement or alleged untrue statement of a material fact in the registration statement of which this prospectus forms a part, or any omission or alleged omission in this prospectus or the registration statement to state a material fact necessary in order to make the statements made not misleading. This indemnification includes liabilities that the selling stockholders may incur under the Securities Act. We do not have to give such indemnification if the untrue statement or omission was made in reliance upon and in conformity with information furnished in writing to us by the selling stockholders for use in this prospectus or the registration statement.
We have advised the selling stockholders that the anti-manipulation rules of Regulation M under the Exchange Act may apply to sales of shares in the market and to the activities of the selling stockholders and its affiliates. The selling stockholders may indemnify any broker-dealer that participates in transactions involving the sale of the shares against certain liabilities, including liabilities arising under the Securities Act.
Transfer Agent
The transfer agent for our common stock is Continental Stock Transfer & Trust Company, New York, New York.
LEGAL MATTERS
Certain legal matters in connection with the issuance of the securities offered under this prospectus will be passed upon for us by Greenberg Traurig, LLP, Los Angeles, California.
EXPERTS
The financial statements incorporated in this Prospectus by reference to the Annual Report on Form 10-K for the year ended December 31, 2022 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the Commission a registration statement on Form S-3, including exhibits, under the Securities Act with respect to the securities offered by this prospectus. This prospectus, which is part of the registration statement, does not contain all of the information in the registration statement. For further information about us and our securities, you should refer to the registration statement, including exhibits, and the financial statements and notes filed as a part thereof.
We file quarterly and annual reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission" or the "SEC"). We have also filed a registration statement on Form S-3Commission. Our filings with the Commission. This prospectus, which forms part ofCommission, including the registration statement, does not have all of the information contained in the registration statement. You may read, free of charge, and copy, at the prescribed rates, any reports, proxy and information statements, and other information includingare available to you on the registration statement,Commission’s website at the Commission's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. The public may obtain information concerning the operation of the Public Reference Room by callinghttp://www.sec.gov. In addition, documents that we file with the Commission are available on our website at 1-800-SEC-0330. The Commission also maintains a website that contains reports, proxy statements and other information, including the registration statement. Thewww.cadizinc.com. Our website address is: http://www.sec.gov.provided in this prospectus is not intended to function as a hyperlink and the information on our website is not, nor should it be considered, part of this prospectus or incorporated by reference into this prospectus.
INFORMATION INCORPORATED BY REFERENCE
The Commission allows us to "incorporate“incorporate by reference"reference” into this prospectus the information we file with them. The information we incorporate by reference into this prospectus is an important part of this prospectus. Any statement in a document we have filed with the Commission prior to the date of this prospectus and which is incorporated by reference into this prospectus will be considered to be modified or superseded to the extent a statement contained in the prospectus or any other subsequently filed document that is incorporated by reference into this prospectus modifies or supersedes that statement. The modified or superseded statement will not be considered to be a part of this prospectus, except as modified or superseded.
We incorporate by reference into this prospectus the information contained in the following documents, which is considered to be a part of this prospectus:
· | ● | our Annual Report on Form 10-K for the year ended December 31, 2015,2022, filed on March 14, 2016;30, 2023; |
· | ● | our Current Reports on Form 8-K filed on January 31, 2023 and February 12, 2016, March 10, 2016, April 29, 2016, May 11, 2016, May 26, 2016, June 14, 2016 and June 23, 2016;8, 2023; |
· | our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2016 and June 30, 2016, filed on May 9, 2016 and August 8, 2016, respectively; |
·● | the description of our common stock as set forth in our registration statement filed on Form 8-A under the Exchange Act on May 8, 1984, as amended by reports on:by: |
· | Form 8-K filed with ● | the SEC on May 26, 1988; |
· | Form 8-K filed withdescription of our common stock as set forth in Exhibit 4.4 to the SEC on June 2, 1992; |
· | Form 8-K filed with the SEC on May 18, 1999; and |
· | Annual Report on Form 10-K for the year ended December 31, 2003,2022, filed on NovemberMarch 30, 2023; |
| ● | the description of our Series 1 Preferred as set forth in the Current Report on Form 8-K filed with the Commission on March 9, 2020; |
| | |
| ● | the registration statement filed on Form 8-A under the Exchange Act on July 2, 20042021; and |
| ● | the Definitive Proxy Statement on Form DEF 14A filed with the Commission on April 28, 2023. |
We also incorporate by reference all additional documents that we file with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act that are filed after the date of the initial registration statement and prior to the effectiveness of the registration statement or that are filed after the effective date of the registration statement of which this prospectus is a part and prior to the termination of the offering of securities offered pursuant to this prospectus. We are not, however, incorporating in each case, any documents or information that we are deemed to "furnish"“furnish” and not file in accordance with the Commission rules.
You may obtain a copy of these filings, without charge, by writing or calling us at:
Cadiz Inc.
550 South Hope Street
Suite 2850
Los Angeles, California 90071
Attention: Investor Relations
(213) 271-1600
No dealer, salesperson, or other person has been authorized to give any information or to make any representation not contained in this prospectus, and, if given or made, such information and representation should not be relied upon as having been authorized by us.us or the selling stockholders. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any of the securities offered by this prospectus in any jurisdiction or to any person to whom it is unlawful to make such offer or solicitation. Neither the delivery of this prospectus nor any sale made hereunder shall under any circumstances create an implication that there has been no change in the facts set forth in this prospectus or in our affairs since the date hereof.
THE COMPANY
About Cadiz
We are a land and water resource development company with 45,000 acres of land in three areas of eastern San Bernardino County, California. Virtually all of this land is underlain with high-quality, naturally recharging groundwater resources, and is situated in proximity to the Colorado River and the Colorado River Aqueduct ("CRA"), a major source of imported water for Southern California. Our properties are suitable for various uses, including large-scale agricultural development, groundwater storage and water supply projects. Our main objective is to realize the highest and best use of our land and water resources in an environmentally responsible way.
We believe that the long-term highest and best use of our land and water assets can best be realized through the development of a combination of water supply and storage projects at our properties. Therefore, the Company has been primarily focused on the development of the Cadiz Valley Water Conservation, Recovery and Storage Project ("Water Project" or "Project"), which will capture and conserve millions of acre-feet1 of native groundwater currently being lost to evaporation from the aquifer system beneath our 34,000-acre property in the Cadiz and Fenner valleys of eastern San Bernardino County (the "Cadiz/Fenner Property"), and deliver it to water providers throughout Southern California (see "Water Resource Development"). We believe that the ultimate implementation of this Water Project will provide a significant source of future cash flow.
The primary factor driving the value of such projects is ongoing pressure on water supplies throughout California, which has led Southern California water providers to actively seek new, reliable supply solutions to plan for both short and long-term water needs. Available supply is constrained by environmental and regulatory restrictions on each of the State's three main water sources: the State Water Project, which provides water supplies from Northern California to the central and southern parts of the state, the CRA and the Los Angeles Aqueduct. Southern California's water providers rely on imports from these systems for a majority of their water supplies, but deliveries from all three into the region have been below capacity over the last several years.
Availability of supplies in California also differs greatly from year to year due to natural hydrological variability. Over the last several years, California has struggled through a historic drought featuring record-low winter precipitation and reservoir storage levels. In 2015, for the first time in the state's history, California Governor Jerry Brown mandated rationing of 25% statewide in an effort to curtail urban demand. An "El Nino" weather pattern developed at the end of 2015 and brought wet conditions to California, yet snowpack and precipitation remain average for the year, especially in Southern California. According to the US Drought Monitor, as of February 2016, more than 99% of California remains abnormally dry. The Water Project is one of the few nearly "shovel-ready" supply options in Southern California that could help alleviate the region's water supply challenges. (See "Water Resource Development" below.) In addition to our water resource development activities, we also continue to explore additional uses of our land and water resource assets, including new agricultural opportunities, the development of a land conservation bank on our properties outside the Water Project area and other long-term legacy uses of our properties, such as habitat conservation and cultural uses.
In addition to an urgent need in California for new, reliable water supplies, demand for agricultural land with water rights is also at an all-time high. Therefore, in addition to our Water Project proposal, we are pursuing ways in which the groundwater currently being lost to evaporation from the aquifer system at the Cadiz/Fenner property can be immediately put to beneficial use through sales, leasing, or agricultural joint ventures that are complementary to the Water Project.
1 One acre-foot is equal to approximately 326,000 gallons or the volume of water that will cover an area of one acre to a depth of one-foot. An acre-foot is generally considered to be enough water to meet the annual water needs of one average California household.
We have farmed portions of the Cadiz/Fenner Property since the late 1980s relying on groundwater from the aquifer system for irrigation and we believe the site is well suited for various permanent and seasonal crops. In 1993, we secured permits to develop agriculture on up to 9,600 acres of the property and withdraw groundwater from the underlying aquifer system for irrigation. We initially developed 1,900 acres of agriculture at the Property, including a well-field and manifold system and since have maintained various levels of agriculture at the Property as we focused on developing the Water Project. In February 2016 we completed arrangements to lease 2,100 acres of the Cadiz/Fenner Property for agricultural development as a result of significant interest from third parties in expanding agricultural activity at the Cadiz/Fenner Property.
As part of the agricultural expansion to be conducted under the lease arrangements, the groundwater production capacity of the property's existing well-field is expected to be increased, which will provide additional infrastructure that is complementary to the Water Project. Through work completed in 2015, including the drilling of three additional exploratory wells, we have now identified suitable locations for the drilling of high-production wells powered by natural gas that could produce all of the water allowable under our existing permit for implementation of the Water Project or alternatively to supply irrigation water for all of the agricultural land. While any additional well-field development for agricultural use would be financed by our agricultural partners as provided under our agricultural arrangements, the Company retained a call feature that allows us, at any time in the initial 20 years, to acquire the well-field and integrate any new agricultural well-field infrastructure developed into the Water Project's facilities.
Our 2016 working capital requirements relate largely to the final development activities associated with the Water Project and those activities consistent with the Water Project related to further development of our land and agricultural assets. While we continue to believe that the ultimate implementation of the Water Project will provide the primary source of our future cash flow, we also believe there is significant additional value in our underlying agricultural assets.
We also continue to explore additional uses of our land and water resource assets, including the marketing of our approved desert tortoise land conservation bank, which is located on our properties outside the Water Project area, and other long-term legacy uses of our properties, such as habitat conservation and cultural development.
Corporate Information
We are a Delaware corporation with our principal executive offices located at 550 South Hope Street, Suite 2850, Los Angeles, California 90071. Our telephone number is (213) 271-1600. We maintain a corporate website at www.cadizinc.com. The information contained in, or that can be accessed through, our website is not a part of this prospectus.
RISK FACTORS
An investment in our securities involves a high degree of risk. Certain risks relating to us and our business are described under the headings "Business" and "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2015, filed with the Commission on March 14, 2016, which is incorporated by reference into this prospectus and which you should carefully review and consider, along with the other information contained in this prospectus or incorporated by reference herein, as updated by our subsequent filings under the Exchange Act, before making an investment in any of our securities. Additional risks, as well as updates or changes to the risks described in the documents incorporated by reference herein, may be included in any applicable prospectus supplement. Our business, financial condition or results of operations could be materially adversely affected by any of these risks. The market or trading price of our securities could decline due to any of these risks, and you may lose all or part of your investment. In addition, please read the section of this prospectus captioned "Special Note Regarding Forward-Looking Statements", in which we describe additional uncertainties associated with our business and the forward-looking statements included or incorporated by reference in this prospectus. Please note that additional risks not presently known to us or that we currently deem immaterial may also impair our business and operations.
Investment in any securities offered pursuant to this prospectus involves risks and uncertainties. If one or more of the events discussed in the risk factors were to occur, our business, financial condition, results of operations or liquidity, as well as the value of an investment in our securities, could be materially adversely affected.
You should carefully consider the risk factors as well as the other information contained and incorporated by reference in this prospectus before deciding to invest.
USE OF PROCEEDS
Unless otherwise provided in the applicable prospectus supplement, the net proceeds from the sale of the securities offered by this prospectus and each prospectus supplement, the "offered securities", will be used for general corporate purposes, which may include working capital needs, the refinancing or repayment of existing indebtedness, capital expenditures, expansion of the business and acquisitions. If any of the net proceeds from the offered securities will be used for acquisitions, we will identify the acquisition in the applicable prospectus supplement. The net proceeds may be invested temporarily in short-term securities or to repay short-term debt until they are used for their stated purpose.
RATIOS OF EARNINGS TO FIXED CHARGES
AND COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS
The ratios of earnings to fixed charges and earnings to combined fixed charges and preferred stock dividend requirements are set forth below for the periods indicated.
| | | Year Ended December 31, |
| | Six months ended
June 30, 2016 | 2015 | 2014 | 2013 | 2012 | 2011 |
| Ratio of Earnings to Fixed Charges | (a) | (a) | (a) | (a) | (a) | (a) | (a) |
| Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividend Requirements | (a) | (a) | (a) | (a) | (a) | (a) | (a) |
(a) | Both (1) fixed charges and (2) combined fixed charges and preferred stock dividend requirements exceeded our earnings (loss) for the six months ended June 30, 2016 by $14.4 million and for the years ended December 31, 2015, 2014, 2013, 2012 and 2011 by $24.0 million, $18.9 million, $22.7 million, $19.9 million, and $16.8 million, respectively. |
For the purpose of calculating both the ratios of earnings to fixed charges and earnings to combined fixed charges and preferred stock dividend requirements, earnings represent net income from continuing operations before the cumulative effect of change in accounting principles, less undistributed equity earnings, plus applicable income taxes plus fixed charges. Fixed charges, excluding interest on deposits, include interest expense (other than on deposits) and the proportion deemed representative of the interest factor of rent expense, net of income from subleases. Fixed charges, including interest on deposits, include all interest expense and the proportion deemed representative of the interest factor of rent expense, net of income from subleases.
DESCRIPTION OF DEBT SECURITIES
This prospectus describes certain general terms and provisions of the debt securities. The debt securities may constitute either senior or subordinated debt securities, and in either case will be unsecured, and may also include convertible debt securities. We will issue any debt securities that will be senior debt under an Indenture between us and U.S. Bank National Association, as trustee (the "Senior Indenture"). We will issue any debt securities that will be subordinated debt under an Indenture between us and U.S. Bank National Association, as trustee (the "Subordinated Indenture"). We may also issue debt securities under the Indentures between Cadiz Inc., as Issuer, and U.S. Bank National Association, as Trustee, dated as of March 5, 2013 and December 10, 2015 (the "Existing Indentures"). This prospectus refers to the Senior Indenture and the Subordinated Indenture individually as the "Indenture" and collectively as the "Indentures." The form of Senior Indenture and the form of Subordinated Indenture are included as exhibits to the registration statement of which this prospectus forms a part while the Existing Indentures are incorporated by reference as exhibits to the registration statement. The term "trustee" refers to the trustee under each Indenture, as appropriate.
The Indentures are subject to and governed by the Trust Indenture Act of 1939, as amended. The Indentures are substantially identical, except for the provisions relating to subordination, which are included only in the Subordinated Indenture. The following summary of the material provisions of the Indentures and the debt securities is not complete and is subject to, and is qualified in its entirety by reference to, all of the provisions of the Indentures, each of which has been filed as an exhibit to the registration statement of which this prospectus is a part. We urge you to read the Indenture that is applicable to you because it, and not the summary below, defines your rights as a holder of debt securities. You can obtain copies of the Indentures by following the directions described under the heading "Available Information."
General
The senior debt securities will rank equally with all of our other unsecured and unsubordinated debt. The subordinated debt securities will be subordinated in right of payment to our "Senior Indebtedness", as defined below in the section titled "Subordination". As of June 30, 2016, all of our $118,891,459 aggregate principal amount of existing debt would have ranked senior to the subordinated debt securities and $76,223,279 aggregate principal amount of our debt would have ranked equally with the senior debt securities. The Indentures do not limit the amount of debt, either secured or unsecured, which may be issued by us under the Indentures or otherwise. We may limit the maximum total principal amount for the debt securities of any series. However, any limit under the Indentures may be increased by resolution of our Board of Directors. We will establish the terms of each series of debt securities under the Indentures in a supplemental Indenture, board resolution or company order. The debt securities under the Indentures may be issued in one or more series with the same or various maturities and may be sold at par, a premium or an original issue discount. Debt securities sold at an original issue discount may bear no interest or interest at a rate which is below market rates.
The Indentures do not prohibit us or our subsidiaries from incurring debt or agreeing to limitations on our subsidiaries' ability to pay dividends or make other distributions to us, although the terms of specific debt securities may include such limitations. The agreements governing our indebtedness, including the Existing Indentures, contain limitations on our ability to incur debt or liens, conduct asset sales and pay dividends.
Unless we inform you otherwise in a prospectus supplement, we may issue additional debt securities of a particular series under the Indentures without the consent of the holders of the debt securities of such series outstanding at the time of issuance. Any such additional debt securities, together with all other outstanding debt securities of that series, will constitute a single series of securities under the applicable Indenture.
Unless we inform you otherwise in a prospectus supplement, each series of our senior debt securities will rank equally in right of payment with all of our other unsubordinated debt. The subordinated debt securities will rank junior in right of payment and be subordinate to all of our unsubordinated debt.
We may issue debt securities from time to time in one or more series under the Indentures or under the Existing Indentures. We will describe the particular terms of each series of debt securities we offer in a supplement to this prospectus or other offering material. The prospectus supplement and other offering material relating to a series of debt securities will describe the terms of such debt securities being offered, including (to the extent such terms are applicable to such debt securities):
· | the title of the debt securities; |
· | designation, aggregate principal amount, denomination and currency or currency unit; |
· | the price or prices at which we sell the debt securities and the percentage of the principal amount at which the debt securities will be issued; |
· | whether the debt securities are senior debt securities or subordinated debt securities and applicable subordination provisions, if any; |
· | any limit on the total principal amount of the debt securities and the ability to issue additional debt securities of the same series; |
· | currency or currency units for which such debt securities may be purchased and in which principal of, premium, if any, and any interest will or may be payable; |
· | interest rate or rates (or the manner of calculation thereof), if any; |
· | the times at which any such interest will be payable; |
· | the date or dates from which interest will accrue on the debt securities, or the method used for determining those dates; |
· | the place or places where the principal and interest, if any, will be payable; |
· | any redemption, sinking fund, satisfaction and discharge, or defeasance provisions; |
· | whether such debt securities will be issuable in registered form or bearer form or both and, if issuable in bearer form, restrictions applicable to the exchange of one form for another and to the offer, sale and delivery of certificates in bearer form; |
· | whether and under what circumstances we may from time to time, without the consent of holders of debt securities, issue additional debt securities, having the same ranking and the same interest rate, maturity and other terms as the debt securities being offered, except for the issue price and issue date and, in some cases, the first interest payment date, whereby such additional securities will, together with the then outstanding debt securities, constitute a single class of debt securities under the Indentures, and will vote together on matters under the Senior Indenture; |
· | if material, federal income tax consequences; |
· | whether and under what circumstances we will issue the debt securities in whole or in part as Global Securities as described below under "Global Securities"; |
· | applicable conversion or exchange privileges; |
· | any defaults and events of defaults applicable to the debt securities to be issued; |
· | securities exchange(s) on which the securities will be listed, if any; |
· | whether any underwriter(s) will act as market maker(s) for the securities; |
· | extent to which a secondary market for the securities is expected to develop; |
· | provisions relating to covenant defeasance and legal defeasance; |
· | provisions relating to satisfaction and discharge of the Indenture; |
· | any covenants or restrictions on us or our subsidiaries; and |
· | any other specific terms of the offered debt securities, including any terms in lieu of those described in this prospectus and any terms which may be required by or advisable under United States laws or regulations such as those made a part of the applicable Indenture by the Trust Indenture Act of 1939. |
Material United States federal income tax consequences and special considerations, if any, applicable to any such securities will be described in the applicable prospectus supplement.
Debt securities may be presented for exchange, and registered debt securities may be presented for transfer, in the manner, at the places and subject to the restrictions set forth in the debt securities and as summarized in the applicable prospectus supplement. Such services will be provided without charge, other than any tax or other governmental charge payable in connection with such exchange or transfer, but subject to the limitations provided in the applicable Indenture. Debt securities in bearer form and the coupons, if any, appertaining to such debt securities will be transferable by delivery.
Subordination
The indebtedness represented by the subordinated debt securities will be subordinated in right of payment to existing and future "Senior Indebtedness," as described in the Subordinated Indenture and any accompanying prospectus supplement. The term "Senior Indebtedness" means:
· | all indebtedness for money borrowed incurred by us, unless the terms of the instrument or instruments by which such indebtedness is incurred or created expressly provide that such indebtedness is subordinate to the subordinated debt securities or that such indebtedness is not superior in right of payment to the subordinated debt securities, |
· | any other indebtedness, obligation or liability incurred by us (including any guaranty, endorsement or other contingent obligation of ours in respect of, or to purchase, or otherwise acquire, any obligation of another), direct or indirect, absolute or contingent, or matured or unmatured, which is specifically designated by us as Senior Indebtedness in the instruments evidencing such indebtedness, obligation or liability at the time of its issuance or incurrence, or |
· | any deferral, renewal or extension of any of the foregoing. |
"Senior Indebtedness" does not include:
· | our debt to any of our subsidiaries; |
· | any series of subordinated debt securities issued under the Subordinated Indenture, unless otherwise specified by the terms of any such series; |
· | any of our other debt which by the terms of the instrument creating or evidencing it is specifically designated as being subordinated to or pari passu with the subordinated debt securities; and |
The Subordinated Indenture does not limit our ability to incur additional indebtedness, including indebtedness that ranks senior in priority of payment to the subordinated debt securities. A prospectus supplement relating to each series of subordinated debt securities will describe any subordination provisions applicable to such series in addition to or different from those described above.
By reason of such subordination, in the event of dissolution, insolvency, bankruptcy or other similar proceedings, upon any distribution of assets, (i) the holders of subordinated debt securities will be required to pay over their share of such distribution in respect of the subordinated debt securities to the holders of Senior Indebtedness until such Senior Indebtedness is paid in full and (ii) creditors of ours who are not holders of Senior Indebtedness may recover less, ratably, than holders of Senior Indebtedness and may recover more, ratably, than holders of subordinated debt securities.
Conversion and Exchange
The terms, if any, on which debt securities of any series will be convertible into or exchangeable for our common stock, our preferred stock, another series of our debt securities, other securities, property or cash, or a combination of any of the foregoing, will be summarized in the prospectus supplement relating to such series of debt securities. Such terms may include provisions for conversion or exchange, either on a mandatory basis, at the option of the holder, or at our option, in which the number of shares or amount of our common stock, our preferred stock, another series of our debt securities, other securities, property or cash to be received by the holders of the debt securities would be calculated according to the factors and at such time as summarized in the related prospectus supplement.
Global Securities
The debt securities of a series may be issued in whole or in part in the form of one or more global securities that will be deposited with, or on behalf of, a depositary identified in the prospectus supplement. Global securities will be issued in registered form and in either temporary or definitive form. Unless and until it is exchanged in whole or in part for the individual debt securities, a global security may not be transferred except as a whole by the depositary for such global security to a nominee of such depositary or by a nominee of such depositary to such depositary or another nominee of such depositary or by such depositary or any such nominee to a successor of such depositary or a nominee of such successor. The specific terms of the depositary arrangement with respect to any debt securities of a series and the rights of and limitations upon owners of beneficial interests in a global security will be described in the applicable prospectus supplement.
Restrictive Covenants
We will describe any restrictive covenants, including restrictions on any subsidiary, for any series of debt securities in a prospectus supplement.
Defeasance
At our option, either (a) we will be Discharged (as defined below) from any and all obligations in respect of any series of debt securities under the Indenture or (b) we will cease to be under any obligation to comply with the restriction on our ability to merge, consolidate or sell assets set forth in the applicable Indenture, the requirement that we maintain our existence or certain other restrictions, in either case if we deposit irrevocably with the trustee, in trust, specifically for the benefit of the holders of such series, money or U.S. Government Obligations (as defined below) which through the payment of interest thereon and principal thereof in accordance with their terms will provide money in an amount sufficient (in the written opinion of a nationally recognized firm of independent public accountants in the case of U.S. Government Obligations or a combination of money and U.S. Government Obligations) to pay all the principal of (including any sinking fund payments or analogous obligations), and interest on, the debt securities of such series on the dates such payments are due in accordance with the terms of such series of debt securities. To exercise such option, we are required to deliver to the trustee an opinion of tax counsel to the effect that holders of the debt securities of such series will not recognize income, gain or loss for federal income tax purposes as a result of such deposit and discharge and will be subject to federal income tax in the same amount and in the same manner and at the same times as would have been the case if such deposit and discharge had not occurred.
The term "Discharged" is defined to mean that we are deemed to have paid and discharged the entire indebtedness represented by, and obligations under, the debt securities of such series and to have satisfied all the obligations under the Indenture relating to the debt securities of such series, except for
· | the rights of holders of the debt securities of such series to receive, from the trust fund described above, payment of the principal of and the interest on the debt securities of such series when such payments are due; |
· | our obligations with respect to the debt securities of such series with respect to temporary debt securities, registration, transfer, exchange, replacement of mutilated, destroyed, lost and stolen certificates, maintenance of a paying office and holding money in trust; and |
· | the rights, powers, trusts, duties and immunities of the trustee under the applicable Indenture. |
The term "U.S. Government Obligations" is defined to mean securities that are (i) direct obligations of the United States of America for the payment of which its full faith and credit is pledged or (ii) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case under clauses (i) or (ii) are not callable or redeemable at the option of the issuer thereof, and also includes a depositary receipt issued by a bank or trust company, as custodian with respect to any such U.S. Government Obligation held by such custodian for the account of the holder of a depository receipt, provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Obligation or the specific payment of interest on or principal of the U.S. Government Obligations evidenced by such depository receipt.
Satisfaction and Discharge
In addition, an Indenture will cease to be of further effect with respect to the debt securities of a series issued under that Indenture, subject to certain exceptions generally relating to compensation and indemnity of the trustee, when either:
· | all outstanding debt securities of that series have been delivered to the trustee for cancellation and we have paid all sums payable by us under the Indenture with respect to such series, or |
· | all outstanding debt securities of that series not delivered to the trustee for cancellation either: (i) have become due and payable, (ii) will become due and payable at their stated maturity within one year, or (iii) are to be called for redemption within one year; and we have deposited irrevocably with the trustee, in trust, specifically for the benefit of the holders of such series, money or U.S. Government Obligations which through the payment of interest thereon and principal thereof in accordance with their terms will provide money in an amount sufficient (in the written opinion of a nationally recognized firm of independent public accountants in the case of U.S. Government Obligations or a combination of money and U.S. Government Obligations) to pay all the principal of (including any sinking fund payments or analogous obligations), and interest on, the debt securities of such series on the dates such payments are due in accordance with the terms of such series of debt securities. |
Modification of the Indentures
Modifications and amendments of each Indenture may be made by us and the trustee without the consent of the holders of the debt securities or with the consent of the holders of not less than a majority in principal amount of all outstanding debt securities affected by such modification or amendment; provided however, that no such modification or amendment may, without the consent of the holder of each outstanding debt security affected thereby:
· | change the stated maturity of the principal of, or any installment of principal of or interest on, any debt security; |
· | reduce the principal amount of or interest on, or any premium payable upon redemption of, any debt security; |
· | change certain other terms related to waiver of past defaults or covenants (such as covenants and provisions of the Indenture that may not be amended without the consent of the holder of each outstanding debt security of the series affected); or |
· | reduce the percentage of the principal amount of the outstanding debt security of any series, the consent of whose holders is required to modify or amend the applicable Indenture or waive compliance with, or consent to certain defaults under, the provisions of such Indenture. |
Our Board of Directors does not have the power to waive any of the covenants of each Indenture, including those relating to consolidation, merger or sale of assets.
Events of Default, Notice and Waiver
The following will be "Events of Default" with respect to any particular series of the debt securities under the Indentures:
· | default in any payment of interest on such series when due, continued for 30 days; |
· | default in any payment of principal and premium, if any, of, or sinking fund installment on, such series when due; |
· | default in the performance, or breach, of any covenant or warranty of ours applicable to such series continued for 60 days after written notice to us by the trustee or the holders of at least 25% in principal amount of such series; |
· | certain events of bankruptcy, insolvency or reorganization; and |
· | any other event of default we may provide for that series. |
No Event of Default with respect to a particular series of debt securities necessarily constitutes an Event of Default with respect to any other series of debt securities.
The trustee will, within 90 days after the occurrence of any default with respect to any series of the debt securities, give to the holders thereof notice of such default known to the trustee, unless such default has been cured or waived (the term default for this purpose means any event which is, or after notice or lapse of time, or both, would become, an Event of Default); provided that, except in the case of a default in the payment of principal of (or premium, if any) or interest on any of such series of debt securities or in the payment of any sinking fund installments, the trustee will be protected in withholding such notice if and so long as it in good faith determines that the withholding of such notice is in the interest of the holders of the debt securities of that series.
We will be required to furnish to the trustee each year a statement as to the fulfillment by us of our obligations under the applicable Indenture.
The holders of a majority in principal amount of the outstanding debt securities of any series may, in respect of such series, waive certain defaults and may direct the time, method and place of conducting any proceeding for any remedy available to the trustee or exercising any trust or power conferred on the trustee, provided that such direction shall not be in conflict with any rule of law or with the applicable Indenture. The trustee has the right to decline to follow any such direction if the trustee in good faith determines that the proceeding so directed would be unjustly prejudicial to the holders of debt securities of such series not joining in any such direction or would involve the trustee in personal liability. Each Indenture provides that in case an Event of Default occurs and is continuing with respect to any series of the debt securities, the trustee will be required to exercise any of its rights and powers under such Indenture with the degree of care and skill such as a prudent man would exercise in the conduct of his own affairs. Subject to such provisions, the trustee will be under no obligation to exercise any of its rights or powers under the applicable Indenture at the direction of any of the holders of such debt securities unless such holders have offered to the trustee reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by the trustee in complying with such direction.
If an Event of Default occurs and is continuing with respect to the debt securities of any series, the trustee or the holders of at least 25% in principal amount of such series may declare such series due and payable.
Each Indenture provides that no holder of debt securities of any series may institute any action against us under such Indenture (except actions for payment of overdue principal or interest or premium, if any) unless the holders of at least 25% in principal amount of such series have requested the trustee to institute such action and have offered the trustee reasonable indemnity, and the trustee has not instituted such action within 60 days of such request.
Consolidating, Merger or Sale of Assets
We may not consolidate with or merge into any other corporation or sell our assets substantially as an entirety, unless:
· | the corporation formed by such consolidation or into which we are merged or the corporation which acquires our assets is organized in the United States and expressly assumes the due and punctual payment of the principal of (and premium, if any) and interest on all the debt securities, if any, issued under the applicable Indenture and the performance of every covenant of such Indenture to be performed by us; and |
· | immediately after giving effect to such transaction, no Event of Default, and no event which after notice or lapse of time or both would become an Event of Default, has happened and is continuing. |
Upon any such consolidation, merger or sale, the successor corporation formed by such consolidation, or into which we are merged or to which such sale is made, will succeed to, and be substituted for, us under such Indenture.
Other than the covenants described above, or as set forth in any accompanying prospectus supplement, the Indentures and the debt securities do not contain any covenants or other provisions designed to afford holders of the debt securities protection in the event of a takeover, recapitalization or a highly leveraged transaction involving us.
Governing Law
New York Law will govern the Indentures and the debt securities, without regard to its conflicts of law principles.
DESCRIPTION OF CAPITAL STOCK
The following statements relating to our capital stock do not purport to be complete, and are subject to, and are qualified in their entirety by reference to, the provisions of the Certificate of Incorporation, as amended (the "Certificate") and By-Laws, as amended (the "By-Laws") which are incorporated by reference as exhibits to the registration statement of which this prospectus is a part.
General
The Certificate authorizes a total of 70,100,000 shares of capital stock, of which 70,000,000 may be shares of common stock and 100,000 may be shares of preferred stock.
As of June 30, 2016, 18,677,053 shares of common stock were issued and outstanding and options and warrants to purchase 507,500 shares of common stock issued to directors, employees, consultants and lenders remain outstanding. As of June 30, 2016, the number of stockholders of record of our common stock was 93.
Common Stock
Subject to the rights of the holders of any shares of preferred stock that may at the time be outstanding, record holders of common stock are entitled to such dividends as the Board of Directors may declare. Holders of common stock are entitled to one vote for each share held in their name on all matters submitted to a vote of shareowners and do not have preemptive rights or cumulative voting rights. Holders of common stock are not subject to further calls or assessments as a result of their holding shares of common stock.
If Cadiz is liquidated, the holders of shares of common stock are entitled to share ratably in the distribution remaining after payment of debts and expenses and of the amounts to be paid on liquidation to the holders of shares of preferred stock.
The transfer agent for our common stock is Continental Stock Transfer & Trust Company, New York, New York.
Certain Other Provisions of the Certificate
Delaware law permits a corporation to eliminate the personal liability of its directors to the corporation or to any of its shareowners for monetary damages for a breach of fiduciary duty as a director, except (i) for breach of the director's duty of loyalty, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) for certain unlawful dividends and stock repurchases or (iv) for any transaction from which the director derived an improper personal benefit. The Certificate provides for such limitation of liability.
The Certificate does not permit stockholder action by written consent in lieu of a meeting of stockholders. In addition, special meetings of stockholders may be called only by the Board of Directors, the Chief Executive Officer or the President.
Limitations on Directors' Liability
Our Certificate of Incorporation eliminates the personal liability of a director to us and our shareowners for monetary damages for certain breaches of his or her fiduciary duty as a director to the fullest extent permitted under the General Corporation Law of the State of Delaware.
This provision offers persons who serve on our Board of Directors protection against awards of monetary damages resulting from certain breaches of their fiduciary duty, including grossly negligent business decisions made in connection with takeover proposals for us, and limits our ability or the ability of one of our shareowners to prosecute an action against a director for a breach of fiduciary duty.
Indemnification of Directors and Officers
Our By-Laws and Certificate provide that we will indemnify any of our directors, officers or employees to the fullest extent permitted by the General Corporation Law of the State of Delaware against all expenses, liability and loss incurred in connection with any action, suit or proceeding in which any such person may be involved by reason of the fact that he or she is or was our director, officer or employee. We carry insurance policies in standard form indemnifying our directors and officers against liabilities arising from certain acts performed by them in their capacities as our directors and officers. These policies also indemnify us for any sums we may be required or permitted to pay by law to our directors and officers as indemnification for expenses they may have incurred.
Exchange Listing
Our common stock is listed on the Nasdaq Global Market under the symbol "CDZI".
Anit-Takeover Effects of Delaware Law
Cadiz is subject to the "business combination" provisions of Section 203 of Delaware law. In general, such provisions prohibit a publicly held Delaware corporation from engaging in various "business combination" transactions with any interested stockholder for a period of three years after the date of the transaction in which the person became an interested stockholder, unless
· | prior to the date the interested stockholder obtained such status, the Board of Directors of the corporation approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder; |
· | upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced; or |
· | on or subsequent to such date, the business combination is approved by the Board of Directors of the corporation and authorized at an annual or special meeting of shareowners by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the interested stockholder. |
A "business combination" is defined to include mergers, asset sales and other transactions resulting in financial benefit to an interested stockholder. In general, an "interested stockholder" is a person who, together with affiliates and associates, owns (or within three years, did own) 15% or more of a corporation's voting stock. The statute could prohibit or delay mergers or other takeover or change in control attempts with respect to Cadiz and, accordingly, may discourage attempts to acquire Cadiz even though such a transaction may offer Cadiz's shareowners the opportunity to sell their stock at a price above the prevailing market price.
DESCRIPTION OF OFFERED PREFERRED STOCK
This prospectus describes certain general terms and provisions of our preferred stock. When we offer to sell a particular series of preferred stock, we will describe the specific terms of the securities in a supplement to this prospectus. The prospectus supplement will also indicate whether the general terms and provisions described in this prospectus apply to the particular series of preferred stock. The preferred stock will be issued under a certificate of designations relating to each series of preferred stock and is also subject to our Certificate of Incorporation. The certificate of designations will be filed with the SEC in connection with an offering of preferred stock.
Under the Certificate of Incorporation, our Board of Directors has the authority to
· | create one or more series of preferred stock, |
· | issue shares of preferred stock in any series up to the maximum number of shares of preferred stock authorized, and |
· | determine the preferences, rights, privileges and restrictions of any series. |
Our Board may issue authorized shares of preferred stock, as well as authorized but unissued shares of common stock, without further shareholder action, unless shareholder action is required by applicable law or by the rules of a stock exchange or quotation system on which any series of our stock may be listed or quoted.
The prospectus supplement will describe the terms of any preferred stock being offered, including:
· | the number of shares and designation or title of the shares; |
· | any liquidation preference per share; |
· | any redemption, repayment or sinking fund provisions; |
· | any dividend rate or rates and the dates of payment (or the method for determining the dividend rates or dates of payment); |
· | if other than the currency of the United States, the currency or currencies including composite currencies in which the preferred stock is denominated and/or in which payments will or may be payable; |
· | the method by which amounts in respect of the preferred stock may be calculated and any commodities, currencies or indices, or value, rate or price, relevant to such calculation; |
· | whether the preferred stock is convertible or exchangeable and, if so, the securities or rights into which the preferred stock is convertible or exchangeable, and the terms and conditions of conversion or exchange; |
· | the place or places where dividends and other payments on the preferred stock will be payable; and |
· | any additional voting, dividend, liquidation, redemption and other rights, preferences, privileges, limitations and restrictions. |
All shares of preferred stock offered will be fully paid and non-assessable. Any shares of preferred stock that are issued will have priority over the common stock with respect to dividend or liquidation rights or both.
Our Board of Directors could create and issue a series of preferred stock with rights, privileges or restrictions which effectively discriminates against an existing or prospective holder of preferred stock as a result of the holder beneficially owning or commencing a tender offer for a substantial amount of common stock. One of the effects of authorized but unissued and unreserved shares of capital stock may be to make it more difficult or discourage an attempt by a potential acquirer to obtain control of our company by means of a merger, tender offer, proxy contest or otherwise. This protects the continuity of our management. The issuance of these shares of capital stock may defer or prevent a change in control of our company without any further shareholder action.
The transfer agent for each series of preferred stock will be described in the prospectus supplement.
DESCRIPTION OF WARRANTS
We may issue warrants for the purchase of common stock, preferred stock or debt securities. We may issue warrants independently or together with any offered securities. The warrants may be attached to or separate from those offered securities. We may issue the warrants under warrant agreements to be entered into between us and a bank or trust company to be named in the applicable prospectus supplement, as warrant agent, all as described in the applicable prospectus supplement. The warrant agent will act solely as our agent in connection with the warrants and will not assume any obligation or relationship of agency or trust for or with any holders or beneficial owners of warrants. If we offer warrants, we will file the warrant agreement relating to the offered warrants as an exhibit to, or incorporate it by reference in, the registration statement of which this prospectus is a part.
The prospectus supplement relating to any warrants that we may offer will contain the specific terms of the warrants. These terms may include the following:
· | the title of the warrants; |
· | the price or prices at which the warrants will be issued; |
· | the designation, amount and terms of the securities for which the warrants are exercisable; |
· | the designation and terms of the other securities, if any, with which the warrants are to be issued and the number of warrants issued with each other security; |
· | the aggregate number of warrants; |
· | any provisions for adjustment of the number or amount of securities receivable upon exercise of the warrants or the exercise price of the warrants; |
· | the price or prices at which the securities purchasable upon exercise of the warrants may be purchased; |
· | if applicable, the date on and after which the warrants and the securities purchasable upon exercise of the warrants will be separately transferable; |
· | a discussion of any material U.S. federal income tax considerations applicable to the exercise of the warrants; |
· | the date on which the right to exercise the warrants will commence, and the date on which the right will expire; |
· | the maximum or minimum number of warrants that may be exercised at any time; |
· | information with respect to book-entry procedures, if any; and |
· | any other terms of the warrants, including terms, procedures and limitations relating to the exchange and exercise of the warrants. |
Exercise of Warrants
Each warrant will entitle the holder of warrants to purchase for cash the amount of common stock, preferred stock or debt securities, at the exercise price stated or determinable in the prospectus supplement for the warrants. Warrants may be exercised at any time up to the close of business on the expiration date shown in the applicable prospectus supplement, unless otherwise specified in such prospectus supplement. After the close of business on the expiration date, if applicable, unexercised warrants will become void. Warrants may be exercised as described in the applicable prospectus supplement. When the warrant holder makes the payment and properly completes and signs the warrant certificate at the corporate trust office of the warrant agent or any other office indicated in the prospectus supplement, we will, as soon as possible, forward the common stock, preferred stock or debt securities that the warrant holder has purchased. If the warrant holder exercises the warrant for less than all of the warrants represented by the warrant certificate, we will issue a new warrant certificate for the remaining warrants.
DESCRIPTION OF SUBSCRIPTION RIGHTS
We may issue subscription rights to purchase shares of our common stock or preferred stock. These subscription rights may be issued independently or together with any other security offered hereby and may or may not be transferable by the stockholder receiving the subscription rights in such offering. In connection with any offering of subscription rights, we may enter into a standby arrangement with one or more underwriters or other purchasers pursuant to which the underwriters or other purchasers may be required to purchase any securities remaining unsubscribed for after such offering.
The applicable prospectus supplement will describe the specific terms of any offering of subscription rights for which this prospectus is being delivered, including the following:
· | the price, if any, for the subscription rights; |
· | the exercise price payable for each share of common stock or preferred stock upon the exercise of the subscription rights; |
· | the number of subscription rights issued to each stockholder; |
· | the number and terms of the shares of common stock or preferred stock which may be purchased per each subscription right; |
· | the extent to which the subscription rights are transferable; |
· | any other terms of the subscription rights, including the terms, procedures and limitations relating to the exchange and exercise of the subscription rights; |
· | the date on which the right to exercise the subscription rights shall commence, and the date on which the subscription rights shall expire; |
· | the extent to which the subscription rights may include an over-subscription privilege with respect to unsubscribed securities; and |
· | if applicable, the material terms of any standby underwriting or purchase arrangement entered into by us in connection with the offering of subscription rights. |
The description in the applicable prospectus supplement of any subscription rights we offer will not necessarily be complete and will be qualified in its entirety by reference to the applicable subscription rights certificate, which will be filed with the SEC if we offer subscription rights.
DESCRIPTION OF UNITS
As specified in the applicable prospectus supplement, we may issue units consisting of one or more subscription rights, warrants, debt securities, shares of preferred stock, shares of common stock or any combination of such securities issued by us or by third parties. The applicable prospectus supplement will describe:
· | the terms of the units and of the subscription rights, warrants, debt securities, preferred stock and common stock comprising the units, including whether and under what circumstances the securities comprising the units may be traded separately; |
· | a description of the terms of any unit agreement governing the units; and |
· | a description of the provisions for the payment, settlement, transfer or exchange or the units. |
PLAN OF DISTRIBUTION
We may sell the securities offered by this prospectus from time to time in one or more transactions;
· | to or through underwriters or dealers; or |
· | through a combination of these methods. |
A distribution of the securities offered by this prospectus may also be effected through the issuance of derivative securities, including without limitation, warrants and subscriptions.
In addition, the manner in which we may sell some or all of the securities covered by this prospectus includes, without limitation, through:
· | a block trade in which a broker-dealer will attempt to sell as agent, but may position or resell a portion of the block, as principal, in order to facilitate the transaction; |
· | purchases by a broker-dealer, as principal, and resale by the broker-dealer for its account; or |
· | ordinary brokerage transactions and transactions in which a broker solicits purchasers. |
In addition, we may enter into derivative or hedging transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. In connection with such a transaction, the third parties may sell securities covered by and pursuant to this prospectus and an applicable prospectus supplement or other offering materials, as the case may be. If so, the third party may use securities borrowed from us or others to settle such sales and may use securities received from us to close out any related short positions. We may also loan or pledge securities covered by this prospectus and an applicable prospectus supplement to third parties, who may sell the loaned securities or, in an event of default in the case of a pledge, sell the pledged securities pursuant to this prospectus and the applicable prospectus supplement or other offering materials, as the case may be.
A prospectus supplement with respect to each series of securities will state the terms of the offering of the securities, including:
· | the terms of the offering; |
· | the name or names of any underwriters or agents and the amounts of securities underwritten or purchased by each of them, if any; |
· | the public offering price or purchase price of the securities and the net proceeds to be received by us from the sale; |
· | any delayed delivery arrangements; |
· | any initial public offering price; |
· | any underwriting discounts or agency fees and other items constituting underwriters' or agents' compensation; |
· | any discounts or concessions allowed or reallowed or paid to dealers; and |
· | any securities exchange on which the securities may be listed. |
The offer and sale of the securities described in this prospectus by us, the underwriters or the third parties described above may be effected from time to time in one or more transactions, including privately negotiated transactions, either:
· | at a fixed price or prices, which may be changed; |
· | in an "at the market" offering within the meaning of Rule 415(a)(4) of the Securities Act; |
· | at prices related to the prevailing market prices; or |
General
Underwriters, dealers, agents and remarketing firms that participate in the distribution of the offered securities may be "underwriters" as defined in the Securities Act of 1933. Any discounts or commissions they receive from us and any profits they receive on the resale of the offered securities may be treated as underwriting discounts and commissions under the Securities Act. We will identify any underwriters, agents or dealers and describe their commissions, fees or discounts in the applicable prospectus supplement, as the case may be.
Underwriters and Agents
If underwriters are used in a sale, they will acquire the offered securities for their own account. The underwriters may resell the offered securities in one or more transactions, including negotiated transactions. These sales will be made at a fixed public offering price or at varying prices determined at the time of the sale. We may offer the securities to the public through an underwriting syndicate or through a single underwriter. The underwriters in any particular offering will be named in the applicable prospectus supplement or other offering materials, as the case may be.
Unless the applicable prospectus supplement states otherwise, the obligations of the underwriters to purchase the offered securities will be subject to certain conditions contained in an underwriting agreement that we will enter into with the underwriters at the time of the sale to them. The underwriters will be obligated to purchase all of the securities of the series offered if any of the securities are purchased, unless the applicable prospectus supplement says otherwise. Any initial public offering price and any discounts or concessions allowed, reallowed or paid to dealers may be changed from time to time.
We may designate agents to sell the offered securities. Unless the applicable prospectus supplement states otherwise, the agents will agree to use their best efforts to solicit purchases for the period of their appointment. We may also sell the offered securities to one or more remarketing firms, acting as principals for their own accounts or as agents for us. These firms will remarket the offered securities upon purchasing them in accordance with a redemption or repayment pursuant to the terms of the offered securities. A prospectus supplement or other offering materials, as the case may be, will identify any remarketing firm and will describe the terms of its agreement, if any, with us and its compensation.
In connection with offerings made through underwriters or agents, we may enter into agreements with such underwriters or agents pursuant to which we receive our outstanding securities in consideration for the securities being offered to the public for cash. In connection with these arrangements, the underwriters or agents may also sell securities covered by this prospectus to hedge their positions in these outstanding securities, including in short sale transactions. If so, the underwriters or agents may use the securities received from us under these arrangements to close out any related open borrowings of securities.
Dealers
We may sell the offered securities to dealers as principals. The dealer may then resell such securities to the public either at varying prices to be determined by the dealer or at a fixed offering price agreed to with us at the time of resale.
Direct Sales
We may choose to sell the offered securities directly. In this case, no underwriters or agents would be involved.
Institutional Purchasers
We may authorize agents, dealers or underwriters to solicit certain institutional investors to purchase offered securities on a delayed delivery basis pursuant to delayed delivery contracts providing for payment and delivery on a specified future date. The applicable prospectus supplement or other offering materials, as the case may be, will provide the details of any such arrangement, including the offering price and commissions payable on the solicitations.
We will enter into such delayed contracts only with institutional purchasers that we approve. These institutions may include commercial and savings banks, insurance companies, pension funds, investment companies and educational and charitable institutions.
Indemnification; Other Relationships
We may have agreements with agents, underwriters, dealers and remarketing firms to indemnify them against certain civil liabilities, including liabilities under the Securities Act. Agents, underwriters, dealers and remarketing firms, and their affiliates, may engage in transactions with, or perform services for, us in the ordinary course of business. This includes commercial banking and investment banking transactions.
Market-Making, Stabilization and Other Transactions
There is currently no market for any of the offered securities, other than our common stock which is traded on the Nasdaq Global Market. If the offered securities are traded after their initial issuance, they may trade at a discount from their initial offering price, depending upon prevailing interest rates, the market for similar securities and other factors. While it is possible that an underwriter could inform us that it intends to make a market in the offered securities, any such underwriter would not be obligated to do so, and any such market-making could be discontinued at any time without notice. Therefore, no assurance can be given as to whether an active trading market will develop for the offered securities. We have no current plans for listing of the debt securities, preferred stock, warrants or subscription rights on any securities exchange or quotation system. Any such listing with respect to any particular debt securities, preferred stock, warrants or subscription rights will be described in the applicable prospectus supplement or other offering materials, as the case may be.
Any underwriter may engage in stabilizing transactions, syndicate covering transactions and penalty bids in accordance with Rule 104 under the Securities Exchange Act of 1934. Stabilizing transactions involve bids to purchase the underlying security in the open market for the purpose of pegging, fixing or maintaining the price of the securities. Syndicate covering transactions involve purchases of the securities in the open market after the distribution has been completed in order to cover syndicate short positions.
Penalty bids permit the underwriters to reclaim a selling concession from a syndicate member when the securities originally sold by the syndicate member are purchased in a syndicate covering transaction to cover syndicate short positions. Stabilizing transactions, syndicate covering transactions and penalty bids may cause the price of the securities to be higher than it would be in the absence of these transactions. The underwriters may, if they commence these transactions, discontinue them at any time.
LEGAL MATTERS
Unless otherwise specified in the applicable prospectus supplement, the validity of the securities offered by this prospectus will be passed upon for us by Mitchell Silberberg & Knupp LLP, Los Angeles, California. If legal matters in connection with offerings made by this prospectus are passed on by counsel for the underwriters, dealers or agents, if any, that counsel will be named in the applicable prospectus supplement.
EXPERTS
The financial statements and management's assessment of the effectiveness of internal control over financial reporting (which is included in Management's Report on Internal Control over Financial Reporting) incorporated in this Prospectus by reference to the Annual Report on Form 10-K for the year ended December 31, 2015 have been so incorporated in reliance on the report (which contains an explanatory paragraph relating to the Company's ability to continue as a going concern as described in Note 2 to the financial statements) of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEMItem 14. Other Expenses of Issuance and Distribution
The following table sets forth the costs andDistribution.We estimate that expenses payable by the Registrant in connection with the saledistribution described in this registration statement will be as shown below. All expenses incurred with respect to the distribution, except for fees of counsel, if any, retained individually by the selling stockholders and any discounts or commissions payable with respect to sales of the securities being registered hereby. All amounts are estimates except the registration fee.
| Printing Fees | | $ | 10,000 | |
| Fees of Transfer Agent and Registrar | | | * | |
| Trustee's Fees and Expenses | | | * | |
| Accountant Fees and Expenses | | $ | 10,000 | |
| SEC Filing Fee | | $ | 4,636 | |
| NASD Filing Fee | | | * | |
| Legal Fees and Expenses | | $ | 20,000 | |
| Miscellaneous | | $ | 2,000 | |
| | | | | |
| Total | | | * | |
*Feesshares, will depend upon the typebe paid by us. See "Plan of securities offered and the number of issuances, which cannot be determined.
Distribution”.| SEC registration fee | | $ | 1,747.36 | |
| Printing expenses | | $ | 0.00 | |
| Accounting fees and expenses | | $ | 15,000.00 | |
| Legal fees and expenses | | $ | 75,000.00 | |
| Miscellaneous | | $ | 0.0 | |
| Total | | $ | 91,747.36 | |
ITEMItem 15. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law permits our Board of Directors to indemnify any person against expenses, attorneys'attorneys’ fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by himsuch person in connection with any threatened, pending or completed action, suit or proceeding in which hesuch person is made a party because hesuch person serves or served as a director, officer, employee or agent of Cadiz or of another entity. The language of Section 145 is sufficiently broad to permit indemnification in some situations for liabilities, including reimbursement for expenses incurred, arising under the Securities Act of 1933, as amended. The statute provides that indemnification pursuant to its provisions is not exclusive of other rights of indemnification to which a person may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors, or otherwise.
Our Bylaws provide for mandatory indemnification of our directors and officers, of Cadiz, and those serving at theour request of Cadiz as directors, officers, employees, or agents of other entities, to the maximum extent permitted by law. The Bylaws provide that this indemnification shall be a contract right between each of these persons and Cadiz.
us.Our Certificate of Incorporation provides that a director of the company shall not be personally liable to the company or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability:
(1)for any breach of the director's duty of loyalty to Cadiz or its stockholders;
(2)for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;
(3)under Section 174 of the Delaware General Corporation Law; or
(4)for any transaction from which the director derived an improper personal benefit.
| (1) | for any breach of the director’s duty of loyalty to us or our stockholders; |
| (2) | for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law; |
| (3) | under Section 174 of the Delaware General Corporation Law; or |
| (4) | for any transaction from which the director derived an improper personal benefit. |
Our Certificate of Incorporation provides that if the Delaware General Corporation Law is subsequently amended to authorize the further elimination or limitation of the liability of a director, then the liability of a director shall be eliminated or limited to the fullest extent permitted by the law as amended. We have also purchased a liability insurance policy which insures our directors and officers against certain liabilities, including liabilities under the Securities Act of 1933.1933, as amended.
The following exhibits are filed or incorporated by reference as part of this Registration Statement.
4.13.1* | Specimen form of stock certificate(1)
|
4.2 | amended. |
4.33.2* | |
| 3.3 | Certificate of Incorporation dated November 8, 1996(3) |
4.4 | Amendment to Cadiz Inc. Certificate of Incorporation dated September 1, 1998(1)
|
4.5 | Amendment to Cadiz Inc. Certificate of Incorporation dated December 15, 2003(4)
|
4.6 | Certificate of EliminationDesignation of Series D Preferred Stock, Series E-1 Preferred Stock and Series E-21 Preferred Stock of Cadiz Inc. (incorporated by reference to Exhibit 3.1 to the registrant’s Current Report on Form 8-K dated December 15, 2003(4)
March 5, 2020, filed with the SEC on March 9, 2020). |
4.73.4 | |
4.8 | Amended and Restated Certificate of Designations of Series F Preferred Stock of Cadiz Inc. dated November 30, 2004(5)
|
4.9 | Second Amended and Restated Certificate of Designations of Series F Preferred Stock of Cadiz Inc. dated June 30, 2006(6)
|
4.10 | Cadiz Inc. Bylaws, as amended(7)
|
4.11 | Certificate of Elimination of Series F Preferred Stock of Cadiz Inc. (as filed August 3, 2007)(8)
|
4.12 | Form of Senior Indenture between Cadiz Inc. and U.S. Bank National Association
|
4.13 | Form of Subordinated Indenture between Cadiz Inc. and U.S. Bank National Association
|
4.14 | First Supplemental Indenture, dated as of October 30, 2013, between Cadiz Inc. and The Bank of New York Mellon Trust Company, N.A.(9)
|
4.15 | Second Supplemental Indenture, dated as of November 23, 2015, between Cadiz Inc. and U.S. Bank National Association(10)
|
4.16 | Indenture, dated as of December 10, 2015, between Cadiz Inc. and U.S. Bank National Association(11)
|
4.17 | First Supplemental Indenture, dated as of April 28, 2016, (incorporated by and between Cadiz Inc. and U.S. Bank National Association(12)
|
4.18 | Certificate(s) of Designations with respectreference to Exhibit 3.1 to the Preferred Stock(13)
|
4.19 | Form of Warrant Agreement (including Form of Warrant)(13)
|
4.20 | Form of Subscription Rights Agreement (including form of Subscription Rights Certificate)(13)
|
4.21 | Form of Unit Agreement (including form of Unit)(13)
|
5.1
12.1
| Opinion of Mitchell Silberberg & Knupp LLP as to the legality of the securities being registered
Computation of Ratios of Earnings to Fixed Charges and Combined Fixed Charges and Preferred Dividends
|
23.1 | Consent of PricewaterhouseCoopers LLP
|
23.2 | Consent of Mitchell Silberberg & Knupp LLP (included in its opinion filed as Exhibit 5.1)
|
24.1 | Power of Attorney (included on signature page)
|
25.1 | Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of U.S. Bank National Association for the form of Senior Indenture
|
25.2 | Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of U.S. Bank National Association for the form of Subordinated Indenture
|
25.3 | Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of U.S. Bank National Association under the existing indentures
|
(2) | Previously filed as an exhibitreference to our registration statement on Form S-1 (Registration No. 33-75642) and incorporated herein by reference. |
(3) | Previously filed as an exhibitExhibit 4.4 to our Quarterly Report on Form 10-Q for the quarter ended September 30, 1996 and incorporated herein by reference. |
(4) | Previously filed as an exhibit to ourregistrant’s Annual Report on Form 10-K for the year ended December 31, 2003,2022, filed with the SEC on NovemberMarch 30, 2023) |
| 4.2 | Deposit Agreement, dated effective as of July 2, 20042021, by and among the Company, Continental Stock Transfer & Trust Company, as depositary, and the holders of the depositary receipts issued thereunder incorporated herein by reference. |
(7) | Previously filed as an exhibitreference to ourExhibit 4.1 to the registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1999 and incorporated herein by reference.March 31, 2021, filed with the SEC on May 17, 2021). |
(9)* | Previously filed as an exhibit to our Current Report on Form 8-K dated October 30, 2013 and filed on October 31, 2013 and incorporated herein by reference.Filed herewith |
(10) | Previously filed as an exhibit to our Current Report on Form 8-K dated November 23, 2015 and filed on November 30, 2015. |
(11) | Previously filed as an exhibit to our Current Report on Form 8-K dated December 10, 2015 and filed on December 16, 2015. |
(12) | Previously filed as an exhibit to our Current Report on Form 8-K dated April 26, 2016 and filed on April 29, 2016. |
(13) | To be filed, if necessary, by amendment or as an exhibit to one or more Current Reports on Form 8-K and incorporated by reference herein. |
ITEMItem 17. Undertakings.
The undersigned Registrantregistrant hereby undertakes:
| (a) | The undersigned registrant hereby undertakes: |
| (1) | Toto file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
| (i) | To include any prospectus required by Sectionsection 10(a)(3) of the Securities Act of 1933, as amended (the "Securities Act");1933; |
| (ii) | To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percenta 20% change in the maximum aggregate offering price set forth in the "Calculation“Calculation of Registration Fee"Fee” table in the effective Registration Statement;registration statement; |
| (iii) | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; |
provided,
, however,, that paragraphs
(a)(1)(i),
(a)(1)(ii) and
(a)(1)(iii) do not apply if
the registration statement is on Form S-3, and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the
Registrantregistrant pursuant to
Sectionsection 13 or
Sectionsection 15(d) of the Securities Exchange Act of 1934
as amended (the "Exchange Act") that are incorporated by reference in the
Registration Statement,registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of
thethis registration
statement.statement; | (2) | That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.thereof; and |
| (3) | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
| (4) | [Intentionally omitted] |
| (5) | That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser: |
| (i) | each prospectus filed byIf the Registrant pursuantregistrant is subject to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and |
(ii) | 430C, each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5) or (b)(7) as part of thea registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act430A, shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectusit is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date,first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.date of first use. |
(5) | (b) | That for the purpose of determining liability of a Registrant under the Securities Act to any purchaser in the initial distribution of the securities, the undersigned Registrant undertakes that in a primary offering of securities of the undersigned Registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned Registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: |
(i) | Any preliminary prospectus or prospectus of the undersigned Registrant relating to the offering required to be filed pursuant to Rule 424; |
(ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned Registrant or used or referred to by the undersigned Registrant; |
(iii) | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned Registrant or its securities provided by or on behalf of the undersigned Registrant; and |
(iv) | Any other communication that is an offer in the offering made by the undersigned Registrant to the purchaser. |
(6) | The undersigned Registrant hereby undertakes that for the purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant'sregistrant’s annual report pursuant to Sectionsection 13(a) or Sectionsection 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan'splan’s annual report pursuant to section 15(d) of the Securities Exchange Act)Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
(7) | (c) | Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrantregistrant pursuant to the foregoing provisions, set forth in response to Item 15, or otherwise, the Registrantregistrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrantregistrant of expenses incurred or paid by a director, officer or controlling person of the Registrantregistrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrantregistrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. |
Pursuant to the requirements of the Securities Act of 1933, the Registrantregistrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Los Angeles, State of California, on October 28, 2016.
May 10, 2023. | CADIZ INC. |
| Registrant
|
| |
| By:
| /s/ Timothy J. Shaheen |
| | Timothy J. Shaheen, Chief Financial Officer Registrant |
| | (Principal Financial |
| By: | /s/ Scott Slater |
| | Scott Slater, Chief Executive Officer and Accounting Officer) President |
KNOW ALL YE BY THESE PRESENTS, that each individual whose signature appears below constitutes and appoints Scott Slater and Timothy J. Shaheen,Stanley E. Speer, and each of them, his true and lawful attorneys-in-fact and agents with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement and any subsequent registration statements filed by the Registrant pursuant to Rule 462(b) of the Securities Act of 1933, which relates to this Registration Statement, and to file same, with all exhibits thereto, and all documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
| | Date |
| | |
| /s/ Susan Kennedy | | May 10, 2023 |
| Susan Kennedy, Chair | | |
| | |
/s/ Scott S. Slater
| | May 10, 2023 |
Scott S. Slater, Chief Executive Officer, President and President
Director | | |
| (Principal Executive Officer) | October 28, 2016 | |
| | |
/s/ Timothy J. Shaheen
Timothy J. Shaheen,Stanley E. Speer | | May 10, 2023 |
Stanley E. Speer, Chief Financial Officer
| | |
| (Principal Financial and Accounting Officer) | October 28, 2016 |
/s/ Keith Brackpool
Keith Brackpool, Chairman
| October 28, 2016 |
/s/ Geoffrey Grant
Geoffrey Grant, Director
| October 28, 2016 |
/s/ Stephen E. Courter
Stephen E. Courter, Director
| October 28, 2016 |
/s/ Winston H. Hickox
Winston H. Hickox, Director
| October 28, 2016 |
/s/ Murray H. Hutchison
Murray H. Hutchison, Director
| October 28, 2016 |
/s/ Raymond J. Pacini
Raymond J. Pacini, Director
| October 28, 2016 |
/s/ Richard Nevins
Richard Nevins, Director
| October 28, 2016 |
| | |
Index to Exhibits
| |
4.1
/s/ Keith Brackpool | Specimen form of stock certificate(1)
| May 10, 2023 |
4.2Keith Brackpool, Director | Cadiz Inc. Certificate of Incorporation, as amended(2)
| |
4.3 | Amendment to Cadiz Inc. Certificate of Incorporation dated November 8, 1996(3)
| |
4.4/s/ Stephen E. Courter | Amendment to Cadiz Inc. Certificate of Incorporation dated September 1, 1998(1)
| May 10, 2023 |
4.5Stephen E. Courter, Director | Amendment to Cadiz Inc. Certificate of Incorporation dated December 15, 2003(4)
| |
4.6 | Certificate of Elimination of Series D Preferred Stock, Series E-1 Preferred Stock and Series E-2 Preferred Stock of Cadiz Inc. dated December 15, 2003(4)
| |
4.7/s/ Maria Echaveste | Certificate of Elimination of Series A Junior Participating Preferred Stock of Cadiz Inc., dated March 25, 2004(4)
| May 10, 2023 |
4.8Maria Echaveste, Director | Amended and Restated Certificate of Designations of Series F Preferred Stock of Cadiz Inc. dated November 30, 2004(5)
| |
4.9 | Second Amended and Restated Certificate of Designations of Series F Preferred Stock of Cadiz Inc. dated June 30, 2006(6)
| |
4.10/s/ Geoffrey T. Grant | Cadiz Inc. Bylaws, as amended(7)
| May 10, 2023 |
4.11Geoffrey T. Grant, Director | Certificate of Elimination of Series F Preferred Stock of Cadiz Inc. (as filed August 3, 2007)(8)
| |
4.12 | Form of Senior Indenture between Cadiz Inc. and U.S. Bank National Association
| |
4.13/s/ Winston H. Hickox | Form of Subordinated Indenture between Cadiz Inc. and U.S. Bank National Association
| May 10, 2023 |
4.14Winston H. Hickox, Director | First Supplemental Indenture, dated as of October 30, 2013, between Cadiz Inc. and The Bank of New York Mellon Trust Company, N.A.(9)
| |
4.15 | Second Supplemental Indenture, dated as of November 23, 2015, between Cadiz Inc. and U.S. Bank National Association(10)
| |
4.16/s/ Kenneth Lombard | Indenture, dated as of December
| May 10, 2015, between Cadiz Inc. and U.S. Bank National Association(11)2023 |
4.17Kenneth Lombard, Director | First Supplemental Indenture, dated as of April 28, 2016, by and between Cadiz Inc. and U.S. Bank National Association(12)
| |
4.18 | Certificate(s) of Designations with respect to the Preferred Stock(13)
| |
4.19/s/ Richard Polanco | Form of Warrant Agreement (including Form of Warrant)(13)
| May 10, 2023 |
4.20Richard Polanco, Director | Form of Subscription Rights Agreement (including form of Subscription Rights Certificate)(13)
| |
4.21 | Form of Unit Agreement (including form of Unit)(13)
| |
5.1
12.1
/s/ Carolyn Webb de Macias | Opinion of Mitchell Silberberg & Knupp LLP as to the legality of the securities being registered
Computation of Ratios of Earnings to Fixed Charges and Combined Fixed Charges and Preferred Dividends
| May 10, 2023 |
| Carolyn Webb de Macias, Director | | |
II-4
23.1 | Consent of PricewaterhouseCoopers LLP
|
23.2 | Consent of Mitchell Silberberg & Knupp LLP (included in its opinion filed as Exhibit 5.1)
|
24.1 | Power of Attorney (included on signature page)
|
25.1 | Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of U.S. Bank National Association for the form of Senior Indenture
|
25.2 | Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of U.S. Bank National Association for the form of Subordinated Indenture
|
25.3 | Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of U.S. Bank National Association under the existing indentures
|
_______
(1) | Previously filed as an exhibit to our Quarterly Report on Form 10-Q for the quarter ended September 30, 1998 and incorporated herein by reference. |
(2) | Previously filed as an exhibit to our registration statement on Form S-1 (Registration No. 33-75642) and incorporated herein by reference. |
(3) | Previously filed as an exhibit to our Quarterly Report on Form 10-Q for the quarter ended September 30, 1996 and incorporated herein by reference. |
(4) | Previously filed as an exhibit to our Annual Report on Form 10-K for the year ended December 31, 2003, filed on November 2, 2004 and incorporated herein by reference. |
(5) | Previously filed as an exhibit to our Current Report on Form 8-K dated November 30, 2004 and filed on December 2, 2004, and incorporated herein by reference. |
(6) | Previously filed as an exhibit to our Current Report on Form 8-K dated July 6, 2006 and filed on July 6, 2006, and incorporated herein by reference. |
(7) | Previously filed as an exhibit to our Quarterly Report on Form 10-Q for the quarter ended June 30, 1999 and incorporated herein by reference. |
(8) | Previously filed as an Exhibit to our Quarterly Report on Form 10-Q for the quarter ended June 30, 2007 and incorporated herein by reference. |
(9) | Previously filed as an exhibit to our Current Report on Form 8-K dated October 30, 2013 and filed on October 31, 2013 and incorporated herein by reference. |
(10) | Previously filed as an exhibit to our Current Report on Form 8-K dated November 23, 2015 and filed on November 30, 2015. |
(11) | Previously filed as an exhibit to our Current Report on Form 8-K dated December 10, 2015 and filed on December 16, 2015. |
(12) | Previously filed as an exhibit to our Current Report on Form 8-K dated April 26, 2016 and filed on April 29, 2016. |
(13) | To be filed, if necessary, by amendment or as an exhibit to one or more Current Reports on Form 8-K and incorporated by reference herein. |
.
