EV Technology Group Announces Closing of Reverse Takeover Transaction and Approval of Listing on the Neo Exchange

Toronto, Ontario, CANADA


NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
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Trading on the NEO on or about April 12, 2022 under the ticker symbol “EVTG”
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TORONTO, April 07, 2022 (GLOBE NEWSWIRE) -- EV Technology Group Ltd. (NEO: EVTG) (the “Company”), formerly Blue Sky Energy Inc. (“BSI”), today announces the successful closing of its previously announced reverse takeover of EV Technology Group Inc. (“EVT”) by BSI (the “Reverse Takeover”). The Company has also received conditional approval for the listing of the Resulting Issuer Shares (as defined below) on the Neo Exchange Inc. (“NEO”) under the ticker symbol “EVTG”, with trading expected to commence at market open on April 12, 2022, subject to fulfillment of all listing requirements.

“Another phase of the company starts with our public listing, which will allow public market investors to invest in electrifying iconic brands and driving experiences. It has been great to work closely with the leadership team at the NEO and I look forward to sharing more updates on our business to shareholders in due course,” commented Wouter Witvoet, CEO and Chairman of the Company.

The Reverse Takeover

The Reverse Takeover was effected by way of a three-cornered amalgamation among BSI, EVT and 1000082448 Ontario Inc. (“Subco”) pursuant to an amalgamation agreement dated January 19, 2022 (the “Amalgamation Agreement”). Immediately prior to and in connection with the Reverse Takeover, BSI effected a consolidation (the “Consolidation”) of the common shares of BSI (the “BSI Shares”) on the basis of one post-Consolidation BSI Share (a “Resulting Issuer Share”) for every four pre-Consolidation BSI Shares, and changed its name to “EV Technology Group Ltd.” Shareholder approval for certain of these matters, where required, was obtained at a meeting of the shareholders of BSI held on February 17, 2022 (the “Meeting”).

In connection with the Reverse Takeover and pursuant to the Amalgamation Agreement, among other things, (a) EVT amalgamated with Subco pursuant to Section 174 of the Business Corporations Act (Ontario) (the “Amalgamation”) to form an amalgamated entity called EV Experiences Inc. (“Amalco”); (b) immediately upon the Amalgamation, each common share in the capital of EVT (the “EVT Shares”) outstanding immediately prior to the Amalgamation, including each EVT Share issued as a result of conversion of the Subscription Receipts (as defined below), was exchanged for fully-paid and non-assessable Resulting Issuer Shares on the basis of one EVT Share for every 4.7 Resulting Issuer Shares (the “Exchange Ratio”), following which all EVT Shares were cancelled; (c) the outstanding common shares of Subco were cancelled and replaced by common shares in the capital of Amalco on a one-for-one basis; (d) in consideration of the Resulting Issuer Shares issued to the previous holders of EVT Shares, Amalco issued to the Company one common share in the capital of Amalco for each Resulting Issuer Share issued; and (e) Amalco continued as a wholly-owned subsidiary of the Company. No fractional Resulting Issuer Shares were issued or delivered pursuant to the Reverse Takeover. Any fractional interest in a Resulting Issuer Share was rounded down to the next lowest number of whole Resulting Issuer Shares and no consideration was paid in lieu thereof.

Prior to the completion of the Reverse Takeover, as a condition to closing pursuant to the Amalgamation Agreement, BSI entered into shares for debt settlement agreements (the “Shares for Debt Settlement Agreements”) with certain creditors of BSI to which BSI was indebted in the total aggregate amount of $2,633,293.88 (the “Debt”). Pursuant to the Shares for Debt Settlement Agreements, BSI issued a total of 10,005,359 common shares (on a pre-Consolidation Basis) (the “Shares for Debt”) in the capital of BSI to such creditors in full in final satisfaction of the Debt.

Prior to completion of the Reverse Takeover, as a condition to closing pursuant to the Amalgamation Agreement, BSI entered into a share purchase agreement dated as of April 4, 2022 with a third party purchaser (the “Purchaser”) pursuant to which BSI agreed to sell, and the Purchaser agreed to purchase, 18 shares in the capital of Sonoro Energy Iraq B.V., being all of the issued and outstanding shares held by BSI, in exchange for the sum of $1.00.

Immediately prior to the completion of the Reverse Takeover and upon the satisfaction of certain escrow release conditions, the 5,811,500 subscription receipts (the “Subscription Receipts”) issued by EVT on March 15, 2022 and March 25, 2022 pursuant to the previously announced non-brokered private placement were automatically exchanged, for no additional consideration, into an aggregate of approximately 1,236,489 EVT Shares. In connection with the Reverse Takeover, such EVT Shares were exchanged for 5,811,500 Resulting Issuer Shares on the basis of the Exchange Ratio.

Following closing of the Reverse Takeover, the Company has 106,298,050 Resulting Issuer Shares issued and outstanding, of which 10,222,580 Resulting Issuer Shares result from the Consolidation of the pre-Reverse Takeover Common Shares held by the shareholders of BSI (inclusive, for greater certainty, of the holders of the Shares for Debt), and 96,075,470 Resulting Issuer Shares were issued to former shareholders and securityholders of EVT (inclusive, for greater certainty, of holders of the Subscription Receipts).

Following closing of the Reverse Takeover, the Company will carry on the business of EVT, under the new name, being EV Technology Group Ltd.

Following the Reverse Takeover, the leadership team of the Company is as follows:

Wouter Witvoet, Chief Executive Officer, Director and Chairman of the Board
Ryan Ptolemy, Chief Financial Officer
Olivier Francois Roussy Newton, President and Director
David Maher, Chief Operating Officer
Kenny Choi, Corporate Secretary
Jon Foster, Director
Kent Thexton, Director
Manpreet Singh, Director

Further details of the Reverse Takeover and the concurrent financing are contained in news releases of BSI dated March 15, 2022, January 19, 2022 and December 31, 2021. Readers are also referred to the filing statement of the Company dated April 4, 2022 (the “Filing Statement”) which was prepared in accordance with the requirements of the NEO and filed under the Company’s issuer profile on SEDAR at www.sedar.com.

NEO Listing

On April 1, 2022, the common shares of BSI were delisted from the NEX board of the TSX Venture Exchange. The Corporation has received conditional approval from the NEO to list the Resulting Issuer Shares on the NEO under the ticker symbol “EVTG”. Final approval by NEO is subject to fulfilling all of the Exchange’s listing requirements and issuance of a corporate exchange bulletin by the NEO. It is anticipated that trading of the Resulting Issuer Shares under the new ticker symbol will commence on the NEO on or about April 12, 2022.

Grant of Options and DSUs

The Company also announces that today it has granted a total of 9,750,000 options to acquire Resulting Issuer Shares pursuant to the Company’s stock option plan (“Options”), and 4,500,000 deferred share units to acquire Resulting Issuer Shares pursuant to the Company’s deferred share unit plan (“DSUs”). Further details with respect to such grants are contained in the Filing Statement.

Investor Relations Agreements

Generation IACP Inc. has been engaged to provide the Company with investor relations services, including certain issuer trading services, as prescribed by an issuer trading services agreement entered into between EVT and Generation IACP Inc. dated February 17, 2022. Generational IACP Inc. is an arm’s length party based in Toronto.

Native Ads, Inc. has been engaged to provide the Company with investor relations services, including digital media, marketing and data analytics services pursuant to a master services agreement entered into between EVT and Native Ads, Inc. dated January 24, 2022. Native Ads, Inc. is an arm’s length party based in New York.

Hybrid Financial Ltd. has been engaged to provide the Company with investor relations services, including marketing services pursuant to a marketing agreement entered into between EVT and Hybrid Financial Ltd. dated March 17, 2022. Hybrid Financial Ltd. is an arm’s length party based in Toronto.

Escrow Agreement

The Company entered into an escrow agreement with certain of its shareholders and TSX Trust Company (the “Escrow Agent”), as escrow agent, on April 7, 2022 (the “Escrow Agreement”). Pursuant to the Escrow Agreement, an aggregate of 61,800,887 Resulting Issuer Shares (the “Escrowed Shares”) held by certain shareholders of the Company are held in escrow by the Escrow Agent, and will be released in twelve equal monthly installments, commencing on the date of the issuance of the corporate exchange bulletin by the NEO referred to above, and ending on the date that is eleven months following the closing of the Reverse Takeover.

Early Warning

Wouter Witvoet, a holder of Resulting Issuer Shares individually makes the following announcement in accordance with National Instrument 62-103 - The Early Warning System and Related Take-Over Bid and Insider Reporting Issues (“NI 62-103”).

In connection with the Reverse Takeover, Mr. Witvoet acquired ownership, control or direction over Resulting Issuer Shares requiring disclosure pursuant to the early warning requirements of NI 62-103. Immediately prior to completion of the Reverse Takeover, Mr. Witvoet did not have ownership of, or exercised control or direction over, any voting or equity securities of the Company.

Pursuant to the Reverse Takeover, Mr. Witvoet acquired ownership, directly and indirectly, of 11,370,000 Resulting Issuer Shares representing approximately 10.70% of the outstanding Resulting Issuer Shares on a non-diluted basis and 2,500,000 Options and 2,000,000 DSUs. Assuming the exercise in full of the Options and the full vesting of DSUs, Mr. Witvoet will hold 15,870,000 Resulting Issuer Shares representing 14.32% of the then issued and outstanding Resulting Issuer Shares on a partially diluted basis.

The Company understands that Mr. Witvoet acquired the aforementioned securities for investment purposes and may, from time to time and depending on market and other conditions and subject to the requirements of applicable securities laws, acquire additional Resulting Issuer Shares through market transactions, private agreements, treasury issuances, dividend reinvestment programs, exercise of options, convertible securities or otherwise (if and when granted), or may, subject to the requirements of applicable securities laws, sell all or some portion of the Resulting Issuer Shares he owns or controls (upon release of the securities from escrow, or otherwise in accordance with the terms of the escrow restrictions), or may continue to hold the Resulting Issuer Shares.

This portion of this news release is issued pursuant to NI 62-103, which also requires an early warning report to be filed with the applicable securities regulators containing additional information with respect to the foregoing matters. A copy of the early warning report will be filed by Mr. Witvoet in accordance with applicable securities laws and will be available on the Company’s issuer profile on SEDAR at www.sedar.com. Mr. Witvoet can be contacted at wouter@evtgroup.com or at 198 Davenport Road, Toronto, Ontario M5R 1J2, Attn: Corporate Secretary, to obtain a copy of Mr. Witvoet’s early warning report. The Company’s head office is located at 198 Davenport Road, Toronto, Ontario M5R 1J2.

About EVT

EVT has as its mission to electrify iconic driving experiences. EVT focuses on acquiring iconic brands and invests in making the transition to electric.

For further information contact:

EV Technology Group Ltd.
Wouter Witvoet, CEO and Chairman of the Board
Phone: +41782008566
Email: wouter@evtgroup.com

Forward-Looking Information

This news release contains forward-looking statements including, but not limited to, statements about the Company’s strategies, expectations, planned operations or future actions; the listing of the Resulting Issuer Shares on the NEO; and statements with respect to the future intentions of Mr. Witvoet. Often, but not always, these Forward-looking Statements can be identified by the use of words such as “estimated”, “potential”, “open”, “future”, “assumed”, “projected”, “used”, “detailed”, “has been”, “gain”, “planned”, “reflecting”, “will”, “containing”, “remaining”, “to be”, or statements that events, “could” or “should” occur or be achieved and similar expressions, including negative variations.

Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any results, performance or achievements expressed or implied by the Forward-looking Statements, including those factors discussed under “Risk Factors” in the Filing Statement. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in Forward-looking Statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended.

Forward-looking statements involve significant risk, uncertainties and assumptions. Many factors could cause actual results, performance or achievements to differ materially from the results discussed or implied in the forward-looking statements. These factors should be considered carefully and readers should not place undue reliance on the forward-looking statements. Although the forward-looking statements contained in this news release are based upon what management believes to be reasonable assumptions, the Company cannot assure readers that actual results will be consistent with these forward-looking statements. The forward-looking statements contained herein are made as of the date hereof and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise, except where required by law. There can be no assurance that these forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available. Not for distribution to U.S. newswire services or for dissemination in the United States. Any failure to comply with this restriction may constitute a violation of U.S. securities laws.

Neither the NEO nor its Market Regulator (as that term is defined in the policies of the NEO) has in any way passed upon the merits of the Reverse Takeover and neither of the foregoing entities accepts responsibility for the adequacy or accuracy of this release or has in any way approved or disapproved of the contents of this press release.