Due to
the outbreak of, and local, state and federal governmental responses to, the COVID-19 coronavirus pandemic, Water Now, Inc. (the
“Company”) is filing this current report on Form 8-K to avail itself of an extension to file its Annual Report
on Form 10-K for the year ended December 31, 2019 (the “Annual Report”), originally due on March 30, 2020. Specifically,
the Company is relying on an order issued by the Securities and Exchange Commission (the “SEC”) on March 25,
2020 (which extended and superseded a prior order issued on March 4, 2020), pursuant to Section 36 of the Securities Exchange Act
of 1934, as amended (Release No. 34-88465)(the “Order”), regarding exemptions granted to certain public companies.
The Order allows a registrant up to an additional 45 days after the original due date of certain reports required to be filed with
the SEC if a registrant’s ability to file such report timely is affected due to COVID-19.
The
Company’s operations and business have experienced disruptions due to the unprecedented conditions surrounding the
COVID-19 pandemic spreading throughout the United States and the world. These disruptions include, but are not limited to:
cessation in drilling activities in areas where the Company’s Hydraspin products are deployed as a result of the
dramatic decrease in oil prices resulting in either the turning off or the relocation of the
Company’s Hydraspin units, office closures, and the unavailability of key Company personnel required to prepare the
Company’s financial statements for the year ended December 31, 2019 due to suggested, and mandated, social quarantining
and work from home orders.
As such,
the Company will be relying on the Order and will be making use of the 45-day grace period provided by the Order to delay filing
of its Annual Report. The Company plans to file its Annual Report by no later than May 14, 2020, 45 days after the original due
date of its Annual Report.
The Company
is supplementing its risk factors previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December
31, 2018 with the following risk factors:
An
occurrence of an uncontrollable event such as the COVID-19 pandemic is likely to negatively affect, and has to date negatively
affected, our operations.
The occurrence
of an uncontrollable event such as the COVID-19 pandemic is likely to negatively affect our operations. A pandemic typically results
in social distancing, travel bans and quarantine, and the effects of, and response to, the COVID-19 pandemic has limited access
to our facilities, customers, management, support staff and professional advisors. These, in turn, have not only negatively impacted
our operations, financial condition and demand for our services, but our overall ability to react timely to mitigate the impact
of this event. We anticipate that our first quarter and second quarter 2020 financial results, at a minimum, will be significantly
negatively affected by COVID-19; however, the full effect on our business and operation is currently unknown.
Our
business may suffer from the severity or longevity of the Coronavirus/COVID-19 Global Outbreak
The
demand for our services relies upon, among other things, (a) the continued drilling for hydrocarbons in regions where our
Hydraspin units are deployed, such as the Permian Basin, and (b) our ability to receive, retro-fit, deploy and maintain our
Hydraspin units for our customers. The decrease in oil prices has resulted in a decline in the utilization of our Hydraspin
units by customers resulting in a corresponding decrease in revenues. Additionally, government mandated
‘stay-at-home’ and similar from operating altogether. Loss of available employees due to health concerns or the
lack of revenue to pay salaries may in the future limit our ability to operate. Economic recessions, including those brought
on by the COVID-19 Outbreak may have a negative effect on the demand for our services and consequently our operating results.
We have also experienced delays due to the COVID-19 Outbreak in receiving products and supplies which we need to operate. All
of the above may be exacerbated in the future as the COVID-19 Outbreak and the governmental responses thereto continues. All
of the above may in the future cause, and have to date caused, a material adverse effect on our operating results.
Cautionary Note Regarding
Forward-Looking Statements
Certain
of the statements contained in this report should be considered forward-looking statements. These forward-looking statements may
be identified by words such as “may,” “will,” “expect,” “intend,”
“anticipate,” “believe,” “estimate,” “plan,” “project,”
“could,” “should,” “would,” “continue,” “seek,”
“target,” “guidance,” “outlook,” “if current trends continue,”
“optimistic,” “forecast” and other similar words. Such statements include, but are not limited
to, statements about the Company’s plans, objectives, expectations, intentions, estimates and strategies for the future,
and other statements that are not historical facts. These forward-looking statements are based on the Company’s current objectives,
beliefs and expectations, and they are subject to significant risks and uncertainties that may cause actual results and financial
position and timing of certain events to differ materially from the information in the forward-looking statements. These risks
and uncertainties include, but are not limited to, those set forth in the Company’s Annual Report on Form 10-K for the year
ended December 31, 2018, and other risks and uncertainties listed from time to time in the Company’s other filings with the
SEC. There may be other factors of which the Company is not currently aware that may affect matters discussed in the forward-looking
statements and may also cause actual results to differ materially from those discussed. In addition, there is uncertainty about
the spread of the COVID-19 virus and the impact it may have on the Company’s operations, the demand for the Company’s
products or services, global supply chains and economic activity in general. The Company does not assume any obligation to publicly
update or supplement any forward-looking statement to reflect actual results, changes in assumptions or changes in other factors
affecting these forward-looking statements other than as required by law. Any forward-looking statements speak only as of the date
hereof or as of the dates indicated in the statement.