Innovation Beverage Acquires Controlling Interest in BlockFuel

Innovation Beverage announced that it has acquired a controlling interest in BlockFuel Energy. This transaction represents a milestone towards the proposed merger between both companies, which they anticipate closing in the coming weeks. On March 16, IBG entered into a share exchange agreement with certain shareholders of BFE pursuant to which IBG acquired 127,628 shares of BFE common stock, representing approximately 51% of BFE's outstanding equity. As consideration for those shares, IBG issued warrants to purchase an aggregate of 3,815,766 ordinary shares of IBG at an exercise price of $0.0001 per share, which are not exercisable until shareholder approval and approval by Nasdaq are obtained. The warrant shares represent 45.9% of the issued and outstanding shares of IBG and will represent 51% of the merger consideration payable at the time of the closing of the merger. Upon the consummation of the proposed merger between IBG and BFE, the warrants will be automatically adjusted to an aggregate of 20,643,297 ordinary shares of IBG and will be deemed exercised. As part of the transaction, IBG also provided BFE with a $2.5M unsecured loan, which facilitated the repurchase and cancellation of certain outstanding BFE shares. Following the closing of the previously announced merger, this loan will convert into an intercompany balance within the combined organization, further consolidating IBG's ownership position. Concurrently, IBG, BFE, and IBG's wholly owned subsidiary, InnoBev Merger Corp., entered into an amended and restated agreement and plan of merger. Upon completion of the proposed merger, BFE will become a wholly owned subsidiary of IBG and BFE equity holders are expected to own approximately 90% of the combined company, with IBG's existing shareholders owning approximately 10%, subject to customary adjustments and dilution.