VANCOUVER, British Columbia, Feb. 18, 2023 (GLOBE NEWSWIRE) — HYTN Innovations Inc. (formerly, Mount Dakota Energy Corp.) (the “Company”) announces, further to its news releases dated July 12, 2023, February 11, 2023 and February 15, 2023, that it has completed its previously announced acquisition (the “Reverse Take-Over”) of all the outstanding securities of HYTN Beverage Corp. (“HYTN”). The Company also announces completion of the previously announced amalgamation of MMO Merger Holdings Inc., a wholly-owned subsidiary of the Company, with 1306562 B.C. Ltd. (the “Amalgamation”, and together with the “Reverse Take-Over”, the “Transactions”). In connection with the Transactions, the Company has changed its name to “HYTN Innovations Inc.”. The common shares of the Company (the “Common Shares”) have been delisted from the TSX Venture Exchange and are expected to begin trading on the Canadian Securities Exchange (the “CSE”) under the symbol “HYTN” on February 22, 2023.
Following completion of the Transactions, the Company will carry on the business of HYTN. HYTN is a manufacturer of premium cannabis products, with specialized expertise in the formulation, quality control, and regulatory approval of cannabinoid-based nano-emulsions that deploy its proprietary Elevation Technology® to deliver products with rapid, predictable, and stackable effects. HYTN manufactures its products from its purpose-built facility located downtown in the city of Kelowna, in the Okanagan Valley of British Columbia.
Elliot McKerr, Chief Executive Officer, and Jason Broome, Chief Operating Officer, issued the following statement: “Thank you to our entire team. We are grateful for the unwavering support of all our stakeholders through our formulation, development, facility build, licensing and successful public offering. We plan to continue our focus on innovative products that meet our exacting quality standards of “consistent”, “natural”, and “delicious”, and most importantly exceed our consumers’ expectations. Our public listing will provide us with the support needed to rapidly expand our market share and scale to the level our products and customers deserve. We are excited to offer Canadian consumers cannabis products in a format that they are demanding that actually taste good!”
Management
On closing of the Transactions, the leadership team of the Company was reconstituted and is currently composed of the following individuals:
- Elliot McKerr (Chief Executive Officer and Director)
- Jason Broome (Chief Operating Officer and Director)
- Paul More (Chief Financial Officer and Corporate Secretary)
- Eli Dusenbury (Director)
- Vic Neufeld (Director)
- Dennis Staudt (Director)
Transaction Summary
Reverse Take-Over
Pursuant to the terms of a securities exchange agreement dated January 31, 2023, the Company acquired the outstanding securities of HYTN in exchange for the issuance of an aggregate of 15,532,000 Common Shares and 2,532,000 common share purchase warrants to the former securityholders of HYTN, with each such warrant exercisable into one Common Share at a price of $0.50 per share until February 1, 2023.
Amalgamation
Pursuant to the terms of an amalgamation agreement dated February 14, 2023, 1306562 B.C. Ltd. (“Numberco”) and MMO Merger Holdings Inc., a wholly-owned subsidiary of the Company (“Subco”), amalgamated under the Business Corporations Act (British Columbia) with the resulting entity continuing as a wholly-owned subsidiary of the Company. The 38,968,920 common shares and 24,984 common share purchase warrants of Numberco outstanding immediately prior to the Amalgamation were exchanged on a one-for-one basis for Common Shares and common share purchase warrants of the Company, respectively, with each such warrant exercisable into one Common Share at a price of $0.50 per share until September 10, 2023.
Debt Settlement
In connection with the Transactions, the Company settled debt with certain creditors of the Company in the amount of $1,782,474 through the issuance of 5,092,782 Common Shares at a deemed price of $0.35 per share (the “Debt Settlement”). The Common Shares issued pursuant to the Debt Settlement are subject to resale restrictions in accordance with applicable securities laws.
Equity Incentive Awards
The Company issued an aggregate of 10,000,000 performance warrants (“Performance Warrants”) to certain members of the incoming management team in connection with the Reverse Take-Over, with each Performance Warrant exercisable upon vesting into one Common Share at a price of $0.05 per share for a period of five years from the date of issuance. One-half of the Performance Warrants will vest and become exercisable upon the Company achieving revenue of $5,000,000 over a 12-month period following closing of the Reverse Take-Over, with the remaining 50% vesting and becoming exercisable upon the Company achieving revenue of $8,000,000 over a 12-month period following closing of the Reverse Take-Over. The Company has also issued 1,725,000 options (“Options”) and 1,900,000 restricted share units (“RSUs”) to directors, officers, employees and consultants of the Company. Each Option is exercisable upon vesting to acquire one Common Share at a price of $0.35 per share until February 17, 2026, with 25% of the Options vesting three months from the date of issuance and an additional 25% vesting every three months thereafter. Each RSU is redeemable upon vesting for one Common Share, with 25% of the RSUs vesting three months from the date of issuance and an additional 25% vesting every three months thereafter.
About HYTN Innovations Inc.
HYTN formulates, manufactures, markets, and sells premium cannabis goods. With the mission to be the leading provider of consistent, natural, and delicious cannabis products, HYTN focuses its efforts on identifying category opportunities and takes an innovative approach to delivering elevated cannabis experiences to a discerning customer base.
ON BEHALF OF THE BOARD OF DIRECTORS
“Elliot McKerr”
Elliot McKerr
Director
The Canadian Securities Exchange (CSE) has not reviewed, approved or disapproved the contents of this press release.
Certain information contained herein may constitute forward-looking statements that involve risks and uncertainties. Readers are cautioned not to place undue reliance on forward-looking statements, including, but not limited to, statements regarding: (i) the anticipated timing and the receipt of regulatory approvals for the listing of the Common Shares on the CSE; (ii) the proposed business plans and operations of the Company; and (iii) the public listing providing HYTN with the support it needs to rapidly expand its market share and scale its products. Factors that could cause actual results to vary from forward-looking statements or may affect the operations, performance, development and results of the Company’s business include, among other things, the ability of the Company to receive all regulatory approvals in a timely manner; risks and assumptions associated with the Transactions; the realization of the anticipated benefits of the Transactions; the Company’s ability to generate sufficient cash flow from operations to meet its current and future obligations; the Company’s ability to access sources of debt and equity capital; competitive factors, pricing pressures and supply and demand in the Company’s industry; general economic and business conditions; and the effects and impacts of the COVID-19 pandemic, the extent and duration of which are uncertain at this time, on the Company’s business and general economic and business conditions and markets. Any statements that are not statements of historical fact are deemed to be forward-looking statements. The forward-looking statements contained in this news release are made as of the date of this news release, and, except to the extent required by applicable law, the Company assumes no obligation to update or revise forward-looking statements made herein or otherwise, whether as a result of new information, future events, or otherwise. The forward-looking statements contained in this news release are expressly qualified by this cautionary note.
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