Toronto, Ontario–(Newsfile Corp. – December 23, 2022) – Hill Street Beverage Company Inc. (TSXV: HILL) (OTC Pink: HSEEF) (“Hill Street” or the “Company“), a progressive bioscience implementation company that utilizes new technologies to provide innovative cannabis solutions and non-alcoholic beverage products, announces that as of December 22, 2022, it has closed its previously announced non-brokered private placement for gross proceeds of $700,000 (the “Offering“).

The Company has issued 17,500,000 units (the “Units“) at a price of $0.04 per Unit. Each Unit consists of one Common Share and one common share purchase warrant (the “Warrants“) of the Company. Each Warrant is exercisable to acquire one common share of the Company (a “Common Share“) for a period of 24 months following the closing date of the Offering at an exercise price of $0.05 per Common Share, subject to adjustment in certain events and acceleration by the Company in the event that the volume weighted average trading price of the Common Shares on the TSX Venture Exchange is greater than or equal to CDN$0.08 for a period of ten consecutive days, provided that the accelerated time of expiry shall not be less than 60 days from the date that the Company gives notice exercising such right.

Craig Binkley, CEO stated, “We are pleased to have both new and existing investors participate in this financing, which allows the Company to further our important growth initiatives on both the Company’s alcohol-free beverage and DehydraTECH licensing businesses. I am encouraged that insiders represent over 30% of the placement, which demonstrates our insiders’ continued commitment to advancing Hill Street as a progressive global bioscience implementation company.”

As previously announced, the net proceeds of the Offering will be used by the Company to fund marketing, sales and growth initiatives of the Company’s DehydraTECH licensing and alcohol-free beverage business lines (17% of net proceeds), for working capital and other general corporate purposes, and for investor relations activities (1% of net proceeds). The proceeds will not be used to make any payments to non-arm’s length parties.

Insiders of the Company subscribed for approximately $232,000 worth of Units in the Offering, representing 32% of the Offering. Participation by the insiders in the Offering is considered a “related party transaction” pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101“). The transaction is exempt from the valuation and minority approval requirements of MI 61-101 on the basis that the fair market value of the consideration paid by such related parties does not exceed 25% of the market capitalization of the Company. A material change report will be filed in connection with the participation of insiders in the Offering.

All securities issued in Offering are subject to a statutory four-month and one-day hold period under applicable Canadian securities laws.

About Hill Street Beverage Company Inc. (TSXV: HILL)

Hill Street is a progressive bioscience implementation company that utilizes new technologies to provide innovative cannabis solutions and non-alcoholic beverage products globally. We are pioneering the space where craft consumer products meet bioscience by leveraging our deep CPG expertise. We are currently developing the platform for our North American distribution around our rights to use Lexaria Bioscience Corp.’s ground-breaking DehydraTECH™ patent portfolio for product development, licensing and B2B sales of cannabis ingredients.

For more information:

Matthew Jewell, Chief Financial Officer
matthew@hillstreetbevco.com

FORWARD-LOOKING STATEMENTS

Statements in this press release may contain forward-looking information. Any statements in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as “may”, “should”, “would”, “anticipate”, “expects”, and similar expressions. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances, such as future availability of capital on favourable terms, may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement. The forward-looking statements contained in this press release are made as of the date of this press release. The Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as required by securities law.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Not for dissemination in the United States.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/149384

Toronto, Ontario–(Newsfile Corp. – December 19, 2022) – Hill Street Beverage Company Inc. (TSXV: HILL) (OTC Pink: HSEEF) (“Hill Street” or the “Company“), a progressive bioscience implementation company that utilizes new technologies to provide innovative cannabis solutions and non-alcoholic beverage products, issues the following corrected press release to the press release dated December 14, 2022 announcing its intention to complete a non-brokered private placement for gross proceeds of up to $700,000.

The correction is being made to add certain information about the acceleration terms of the Warrants to be issued in the Offering, and certain percentage breakdowns of its intended use of the proceeds, as required by the TSX Venture Exchange.

The complete corrected press release is below:

Hill Street today announces that it intends to complete a non-brokered private placement for gross proceeds of up to $700,000 (the “Offering“), subject to oversubscription at the option of the Company. The Offering is subject to TSX Venture Exchange approval. All dollar figures are quoted in Canadian dollars.

The Offering consists of a non-brokered private placement of up to 17,500,000 units (the “Units“) at a price of $0.04 per Unit. Each Unit will consist of one Common Share and one common share purchase warrant (the “Warrants“) of the Company. Each Warrant will be exercisable to acquire one common share of the Company (a “Common Share“) for a period of 24 months following the closing date of the Offering at an exercise price of $0.05 per Common Share, subject to adjustment in certain events and acceleration by the Company in the event that the volume weighted average trading price of the Common Shares on the TSX Venture Exchange is greater than or equal to CDN$0.08 for a period of ten consecutive days, provided that the accelerated time of expiry shall not be less than 60 days from the date that the Company gives notice exercising such right.

The Company intends to use the net proceeds of the Offering to fund marketing, sales and growth initiatives of the Company’s DehydraTECH licensing and alcohol-free beverage business lines (17% of net proceeds), for working capital and other general corporate purposes, and for investor relations activities (1% of net proceeds). The proceeds will not be used to make any payments to non-arm’s length parties. The Offering is already fully subscribed and closing of the Offering is expected to occur on or about December 21, 2022, subject to the final approval of the TSX Venture Exchange.

Insiders of the Company have subscribed for approximately $232,000 worth of Units in the Offering, representing 32% of the Offering. Participation by the insiders in the Offering is considered a “related party transaction” pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101“). The transaction is exempt from the valuation and minority approval requirements of MI 61-101 on the basis that the fair market value of the consideration paid by such related parties does not exceed 25% of the market capitalization of the Company. A material change report will be filed in connection with the participation of insiders in the Offering.

All securities issued in Offering will be subject to a statutory four-month and one-day hold period under applicable Canadian securities laws.

Matthew Jewell, the Company’s Chief Financial Officer stated: “We are very pleased with the interest we have received in this Offering. The fact that we have received subscriptions for $700K in financing at a 100% premium to the last closing price for our stock shows investor and insider confidence in the Company’s new management team and transformed growth strategy. With this financing, Hill Street is well-positioned to advance the global growth agendas of both of its on-trend business lines with a solid balance sheet.”

About Hill Street Beverage Company Inc. (TSXV: HILL)

Hill Street is a progressive bioscience implementation company that utilizes new technologies to provide innovative cannabis solutions and non-alcoholic beverage products globally. We are pioneering the space where craft consumer products meet bioscience by leveraging our deep CPG expertise. We are currently developing the platform for our North American distribution around our rights to use Lexaria Bioscience Corp.’s ground-breaking DehydraTECH™ patent portfolio for product development, licensing and B2B sales of cannabis ingredients.

For more information:

Matthew Jewell, Chief Financial Officer
matthew@hillstreetbevco.com

FORWARD-LOOKING STATEMENTS

Statements in this press release may contain forward-looking information. Any statements in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as “may”, “should”, “would”, “anticipate”, “expects”, and similar expressions. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances, such as future availability of capital on favourable terms, may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement. The forward-looking statements contained in this press release are made as of the date of this press release. The Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as required by securities law.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Not for dissemination in the United States.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/148701

Toronto, Ontario–(Newsfile Corp. – November 30, 2022) – Hill Street Beverage Company Inc. (TSXV: HILL) (OTC Pink: HSEEF) (“Hill Street” or the “Company“), a progressive bioscience implementation company that utilizes new technologies to provide innovative cannabis solutions and non-alcoholic beverage products, is pleased to announce the following updates from the recently completed Q1 of FY 2023. All dollar figures are quoted in Canadian dollars.

New Product Launches Hit the Market for DehydraTECH™ Licensees

The Company continued to expand its geographic footprint and its portfolio of DehydraTECH™-powered consumer product form factors during the three-month period ended September 30, 2022.

1906 Drops expanded to Michigan, Pennsylvania, and Ohio, and several of the newer DehydraTECH™ licensees, which Hill Street’s commercialization partner Dehydr8 has been working with to develop their commercial manufacturing operations, executed their initial product launches in market. These include:

• Lume Cannabis Co. launched their first DehydraTECH™-powered products under their brand in Michigan dispensaries.

• Neo Alternatives launched their Root 66 brand utilizing DehydraTECH™ in Massachusetts dispensaries.

• Folium Farms prepared for the launch of their Karma brand utilizing DehydraTECH™ in Oregon, which subsequently occurred in early October 2022.

DehydraTECH™ licensing revenues grew by 34% in Q1 versus the same quarter one year ago and the Company expects the financial impact of these new licensee launches to build over the coming quarters.

The Transformed Vin(Zero) Business Model Continues to Drive First Half Strength

As previously announced, the Company’s new streamlined Vin(Zero) alcohol-free beverage business model creates a new and different cadence to the business. We now focus on executing larger orders on a semi-annual basis to greatly increase operational efficiency, versus fragmented monthly or quarterly ordering. Consequently, this business must now be looked at across longer time frames to truly understand its momentum.

Record revenues reported in Q4 FY2022 of over $1MM (vs. average net revenue trends of approximately $475K per quarter) continued to support the Vin(Zero) go-to-market distribution system and retail sales during Q1 FY2023. The result of this new pattern and the large Q4, is significantly lower revenues for this quarter.

However, as of today, Hill Street has already received and sold the Vin(Zero) inventory that it ordered during this past summer and expects Vin(Zero) revenues of over $900,000 in Q2 FY 2023. With these Q2 expected revenues, we anticipate seeing double-digit revenue growth for the full six-month period ended December 31, 2022 compared to the same six-month period in calendar 2021.

*Note: The FY2023 Q2 Vin(Zero) revenue expectations are subject to revision, and anticipated to be finalized and included with the Company’s FY2023 Q2 financials release by March 1, 2023. The Company’s actual FY2023 Q2 Vin(Zero) business financial results could differ materially from these selected preliminary results. Any preliminary unaudited financial projections provided herein have not been prepared in accordance with IFRS.

Release of Q1 FY2023 Financial Statements and MD&A

For the three-month period ended September 30, 2022, the Company has released its Financial Statements, and a comprehensive Company update by way of its Management Discussion and Analysis, which can now be found on the Company’s profile at www.sedar.com.

Craig Binkley, CEO, comments: “Our Q1 results were in line with our expectations, as previously communicated to our shareholders. We are also very pleased that our expected December 31, 2022 results for the Vin(Zero) business validate that the fundamental adjustments we made earlier this year were well considered and on target. By refocusing our efforts towards our two strong-margined and streamlined business segments – Vin(Zero) beverage sales and DehydraTECH™ licensing – we are well positioned to show strong growth as we head into calendar 2023.”

About Hill Street Beverage Company Inc. (TSXV: HILL)

Hill Street is a progressive bioscience implementation company that utilizes new technologies to provide innovative cannabis solutions and non-alcoholic beverage products globally. We are pioneering the space where craft consumer products meet bioscience by leveraging our deep CPG expertise. We are currently developing the platform for our North American distribution around our rights to use Lexaria Bioscience Corp.’s ground-breaking DehydraTECH™ patent portfolio for product development, licensing and B2B sales of cannabis ingredients.

For more information on our business activities or to check out Hill Street’s award-winning alcohol-free line-up and order product to be delivered straight to your home go to www.hillstreetbeverages.com

For more information:

Craig Binkley, Chief Executive Officer
craig@hillstreetbevco.com

FORWARD-LOOKING STATEMENTS

Statements in this press release may contain forward-looking information. Any statements in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as “may”, “should”, “would”, “anticipate”, “expects”, and similar expressions. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances, such as future availability of capital on favourable terms, may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement. The forward-looking statements contained in this press release are made as of the date of this press release. The Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as required by securities law.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Not for dissemination in the United States.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/146184

Toronto, Ontario–(Newsfile Corp. – November 18, 2022) – Hill Street Beverage Company Inc. (TSXV: HILL) (“Hill Street” or the “Company”) announces today that it has extended the expiry date and reduced the exercise price of 11,250,900 warrants (the “Amended Warrants“) of the Company which were originally set to expire today, after having received the approval of the TSX Venture Exchange to such amendments. All dollar figures are quoted in Canadian dollars.

The new expiry date of the Amended Warrants is March 17, 2023 and the reduced exercise price is $0.05. The Amended Warrants include an accelerated expiry provision such that the exercise period of each of the Amended Warrants is reduced to 30 days if for any 10 consecutive trading days, the closing price of the Company’s common shares is equal or greater than $0.0625, with the 30-day expiry period commencing on the day the Company disseminates a press release announcing the commencement of the accelerated expiry period.

Insiders of the Company hold 7,470,000 of the 17,109,000 total warrants (“Total Warrants“) in this series. In accordance with TSX-V policies, only 10%, or 1,709,100, of the Total Warrants are subject to these amendments on a pro-rata basis among such insiders. A portion of the Amended Warrants are held by parties who are considered to be “related parties” of the Company. Therefore, the amendment of Amended Warrants constitutes a “related party transaction” as contemplated by Multilateral Instrument 61-101 Protection of Minority Shareholders in Special Transactions, and TSXV Policy 5.9 – Protection of Minority Shareholders in Special Transactions. However, the exemptions from formal valuation and minority approval requirements provided for by these guidelines can be relied upon as the fair market value of the Amended Warrants does not exceeds 25% of the market capitalization of the Company. A material change report in respect of this related party transaction will be filed by the Company.

While the Company is prioritizing the push to achieve positive quarterly cash flow without additional fundraising through its revenue generating and cost containment measures, it believes that the repricing and extension of the Amended Warrants is reasonable and ‎necessary in the context of the overall market, as it increases the likelihood that any additional cash needs of the Company could be financed through the exercise of the Amended Warrants.

About Hill Street Beverage Company Inc. (TSXV: HILL)

Hill Street Beverage Company Inc. is a progressive non-alcoholic beverage and cannabis solutions company. We are pioneering the space where craft consumer products meet bioscience by combining our deep CPG expertise and our rights to use Lexaria Bioscience Corp.’s ground-breaking DehydraTECH™ patent portfolio for product development, licensing and B2B sales of cannabis ingredients.

For more information on our business activities or to check out Hill Street’s award-winning alcohol-free line-up and order product to be delivered straight to your home go to www.hillstreetbeverages.com

For more information:

Matthew Jewell, Chief Financial Officer
matthew@hillstreetbevco.com

FORWARD-LOOKING STATEMENTS

Statements in this press release may contain forward-looking information. Any statements in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as “may”, “should”, “would”, “anticipate”, “expects”, and similar expressions. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances, such as future availability of capital on favourable terms, may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement. The forward-looking statements contained in this press release are made as of the date of this press release. The Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as required by securities law.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Not for dissemination in the United States.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/144802

Highlights for the Year:

• Delivered outstanding consolidated net revenue growth of +46% YoY for the full year, and exceptional +134% YoY growth in Q4

• Achieved full year gross profit increase of +37% YOY despite supply chain cost increases and inventory write-offs from now-withdrawn (V)ia Regal cannabis beverage business

• Re-engineered our Vin(Zero) commercial business model to improve the key financials of the business and began executing on a global distribution expansion strategy

• Activated and expanded our DehydraTECH™ licensing business, growing the U.S. DehydraTECH™ licensee ecosystem from two to seven and doubling the number of US states in operation in our DehydraTECH™ licensing footprint

• Re-evaluated our overall cannabis strategy for Canada after a full year in-market, subsequently withdrawing the (V)ia Regal cannabis beverage initiative from the Canadian market

• Added key members to the management team to drive the growth agenda

Toronto, Ontario–(Newsfile Corp. – October 31, 2022) – Hill Street Beverage Company Inc. (TSXV: HILL) (“Hill Street” or the “Company”) reported its audited fiscal 2022 results for the twelve-month and three-month periods ended June 30, 2022. A complete set of audited financial statements and Management’s Discussion and Analysis has been filed at www.sedar.com. The Company also announces today that it will apply to the TSX Venture Exchange to amend the expiry date and reprice the exercise price of warrants that are set to expire on November 18, 2022. All dollar figures are quoted in Canadian dollars.

RESULTS OF OPERATIONS

The following table summarizes certain financial information of the Company for the years ended June 30, 2022, June 30, 2021 and June 30, 2020.

BUSINESS HIGHLIGHTS FOR THE FULL FISCAL YEAR 2022

Hill Street’s fiscal year 2022 was by far the most successful fiscal year in the history of Hill Street in terms of both operational and financial results.

“This year was a step-change in our business, highlighted by an outstanding record fourth quarter,” said Craig Binkley, CEO of the Company. “With both our Vin(Zero) alcohol-free wine and DehydraTECH™ licensing businesses, we took bold steps in expanding their footprints and addressable markets during the year. We continue to show dynamic growth and improved financials as evidence of the potential of this next-generation business model.”

Several key highlights of the year:

• Major adjustments were made across all the key areas of the Vin(Zero) business, including production planning, shipping and logistics, warehousing, sales and retail distribution. The changes had a significant positive impact on Q4 sales and are expected to drive key positive financial impacts over time.

• New distribution programs for Vin(Zero) outside of Canada, beginning the push towards global aspirations for this business, including a new distribution and promotional program in the U.S. with New York-based alcohol-free retailer Boisson; and new distribution in Australia.

• Expanded DehydraTECH™ intellectual property licensing relationships, increasing the DehydraTECH™ licensing footprint from four states at the beginning of the fiscal year to eight states at fiscal year-end, representing a population of over 90 million people^[1] (+305% vs. the 29.5MM with which we started the fiscal year) and an addressable market of $19.2B USD^[2] in estimated 2022 total cannabis sales.

• Continued to support the cannabis-infused beverage business in Canada throughout the year, but ultimately decided to withdraw that initiative and focus on the Company’s two strong growth businesses.

FINANCIAL HIGHLIGHTS FOR FULL YEAR FISCAL 2022

Delivered outstanding consolidated net revenue growth of +46% YoY for the full year

Stellar revenue growth for the year was driven by strong growth and business model adjustments on the Vin(Zero) business as well as more than doubling of revenues on the DehydraTECH™ licensing business.

Net Loss Narrowed Substantially in Fiscal 2022

An improvement in earnings was driven primarily by a +37% increase in gross profit, achieved despite significant supply chain cost increases and costs related to the now-withdrawn (V)ia Regal cannabis beverage business. Our preliminary unaudited FY2022 financial results showed expected gross profit for the fiscal year to increase 47% YoY excluding the impact of the (V)ia Regal business, but year-end accounting adjustments resulted in a lower gross profit increase. The strong business growth was accomplished while maintaining relatively flat operating expenses, resulting in a +16% improvement in net earnings.

Q4 HIGHLIGHTS

Q4 Net Revenues More than Doubled to a Record $1.2MM

The strength of the business and the adjustments in the business model drove the Vin(Zero) revenues and total consolidated revenues for the fourth quarter. We also continued to see growth on DehydraTECH^(TM) licensing revenues.

We now have an operating footprint of DehydraTECH^TM licensees in the U.S. covering ten states with a total population of 115MM^[3] and an addressable market of approximately $21.5B USD in estimated 2022 cannabis sales^[4]. That footprint covers states generating almost two-thirds of the addressable market of $33B USD in projected total U.S. cannabis sales for 20228, up from our coverage of less than one-quarter of total U.S. cannabis sales at the beginning of FY 2022.

Appointment of New CFO Completes a Transformational Year of Adding Key Members to the Management Team to Drive the Growth Agenda

Matthew Jewell was appointed as permanent Chief Financial Officer on October 12, 2022, joining Pearl Chan, who joined the Company on September 27, 2021 as its first Chief Legal Officer, and Craig Binkley, who accepted the full-time CEO position on January 6, 2022. The full Hill Street team is now poised to lead the company through its next phase of growth and development.

Application to the TSX Venture Exchange for Warrant Repricing and Expiry Extension

The Company also announces that it will file an application today to the TSX Venture Exchange to extend the expiry date and to amend the exercise price of 11,250,900 warrants (“Warrants“) of the Company issued in connection with a non-brokered private placement of the Company that closed on or around November 18, 2020.

The Company intends to extend the expiry date of the Warrants to March 17, 2023 and to amend the exercise price of the Warrants to $0.05. The Warrants, as amended, would include an accelerated expiry provision such that the exercise period of each of the Warrants would be reduced to 30 days if for any 10 consecutive trading days, the closing price of the Company’s common shares is equal or greater than $0.0625, with the 30-day expiry period commencing on the day the Company disseminates a press release announcing the commencement of the accelerated expiry period. Approval of such Warrant amendments is subject to the approval of the TSX Venture Exchange.

A portion of the Warrants are held by parties who are considered to be “related parties” of the Company. Therefore, the amendment of Warrants constitutes a “related party transaction” as contemplated by Multilateral Instrument 61-101 Protection of Minority Shareholders in Special Transactions, and TSXV Policy 5.9 – Protection of Minority Shareholders in Special Transactions. However, the exemptions from formal valuation and minority approval requirements provided for by these guidelines can be relied upon as the fair market value of the Warrants does not exceeds 25% of the market capitalization of the Company. A material change report in respect of this related party transaction will be filed by the Company.

While the Company is prioritizing the push to achieve positive quarterly cash flow without additional fundraising through its revenue generating and cost containment measures, it believes that the repricing of the Warrants is reasonable and ‎necessary in the context of the overall market, as it increases the likelihood that any additional cash needs of the Company could be financed through the exercise of the Warrants.

About Hill Street Beverage Company Inc. (TSXV: HILL)

Hill Street Beverage Company Inc. is a progressive non-alcoholic beverage and cannabis solutions company. We are pioneering the space where craft consumer products meet bioscience by combining our deep CPG expertise and our rights to use Lexaria Bioscience Corp.’s ground-breaking DehydraTECH™ patent portfolio for product development, licensing and B2B sales of cannabis ingredients.

For more information on our business activities or to check out Hill Street’s award-winning alcohol-free line-up and order product to be delivered straight to your home go to www.hillstreetbeverages.com

For more information:

Craig Binkley, Chief Executive Officer
craig@hillstreetbevco.com

FORWARD-LOOKING STATEMENTS

Statements in this press release may contain forward-looking information. Any statements in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as “may”, “should”, “would”, “anticipate”, “expects”, and similar expressions. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances, such as future availability of capital on favourable terms, may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement. The forward-looking statements contained in this press release are made as of the date of this press release. The Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as required by securities law.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Not for dissemination in the United States.

^[1] US Census Bureau, https://www.census.gov/quickfacts/fact/table/US/PST045221
^[2] MJBiz Factbook 2022
^[3] US Census Bureau, https://www.census.gov/quickfacts/fact/table/US/PST045221
^[4] MJBiz Factbook 2022

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/142441

Toronto, Ontario–(Newsfile Corp. – October 12, 2022) – Hill Street Beverage Company Inc. (TSXV: HILL) (“Hill Street“, or the “Company“) announces that effective today, it has appointed Mr. Matthew Jewell as its permanent Chief Financial Officer, succeeding Ms. Hinta Chambers, who had stepped into the role of interim CFO following her August 2022 resignation as permanent CFO of the Company.

Mr. Jewell joins Hill Street from Next Green Wave Holdings Inc. (“Next Green Wave“), an integrated premium craft cannabis producer and CPG company in California that was publicly traded on the CSE until its acquisition by Planet 13 Holdings Inc. in March 2022. Mr. Jewell was the first full-time employee at Next Green Wave and led the company as its Canada-based CFO, from its inception until its eventual sale in a transaction valued at almost $100M.

In addition to his highly relevant cross-border background in both cannabis and CPG, Matt brings more than a decade of experience in emerging industries, providing strategic recommendations to the executive team and board of directors and guiding financial reporting, financial planning, HR, legal and operations.

Matt spent several years early in his accounting career as an auditor at KPMG and graduated from the University of Victoria with a Bachelor of Commerce.

“I am delighted to welcome Matt as our new CFO to work closely with myself and the rest of the Hill Street team,” said Craig Binkley, Chief Executive Officer. “With Matt’s extensive experience in establishing financial systems and reporting, cash management and capital market strategies, as well as his strong track record of scaling emerging business operations, I am confident he is the right choice for Hill Street as we continue to execute on our transformational strategy and deliver record financial performance. I also want to thank Hinta for her significant contributions to Hill Street in building its financial foundation and for helping us to ensure a smooth transition of the CFO duties.”

Jack Fraser, Chairman of the Board of Directors, comments, “The Board is extremely pleased that we are adding another successful, experienced individual to our Hill Street management team. Matt’s experience in managing all of the key financial aspects of a publicly-traded company will be very valuable as Hill Street continues to drive its global growth agenda.”

Mr. Jewell said, “I am thrilled to join the Hill Street family today. With its experienced and passionate leadership team driving execution of a clear strategy for development of its DehydraTECH^TM licensing business, along with the expansion opportunities that the Company has in the burgeoning alcohol-free beverage category, I think that the Company has an exciting future and that the potential for growth and value creation for shareholders is tremendous.”

In connection with Mr. Jewell’s appointment, the Board has approved a grant of 1MM restricted share units (the “RSUs“) in the Company, subject to certain vesting conditions. The RSU grant is subject to the Company’s RSU Plan and each vested RSU entitles the holder to acquire one common share of the Company.

About Hill Street Beverage Company Inc. (TSXV: HILL)

Hill Street Beverage Company Inc. is a progressive non-alcoholic beverage and cannabis solutions company. We are pioneering the space where craft consumer products meet bioscience by combining our deep CPG expertise and our rights to use Lexaria Bioscience Corp.’s ground-breaking DehydraTECH™ patent portfolio for product development, licensing and B2B sales of cannabis ingredients.

For more information on our business activities or to check out Hill Street’s award-winning alcohol-free line-up and order product to be delivered straight to your home go to www.hillstreetbeverages.com.

For more information:

Craig Binkley, Chief Executive Officer
craig@hillstreetbevco.com

FORWARD-LOOKING STATEMENTS

Statements in this press release may contain forward-looking information. Any statements in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as “may”, “should”, “would”, “anticipate”, “expects”, and similar expressions. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances, such as future availability of capital on favourable terms, may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement. The forward-looking statements contained in this press release are made as of the date of this press release. The Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as required by securities law.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Not for dissemination in the United States.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/140275

Toronto, Ontario–(Newsfile Corp. – October 6, 2022) – Hill Street Beverage Company Inc. (TSXV: HILL) (“Hill Street“, or the “Company“), is pleased to provide a letter to all shareholders from CEO Craig Binkley, with a preview of selected preliminary unaudited financial results highlights for the three-month and twelve-month periods ended June 30, 2022 and an update on operations.

Dear Hill Street Shareholders,

As I stated in my August 11, 2022 Update Letter, fiscal year 2022 was by far the most successful fiscal year in the history of Hill Street. That update included a significant review of the specific operational successes of the Company throughout the year that have helped to drive our financial results. While 2022 audited financials are due at the end of this month, I want to share a preliminary view of select unaudited results which show a strong continuation of the growth trend of the business. In addition, I want to share several operational updates on our business lines to provide context for these results and to preview our evolving business initiatives as we progress through FY23.

Stellar Q4 Performance Drove Significant Growth in Financial Metrics for Q4 and the Full Year

Anticipated consolidated net revenue more than doubled in Q4 of fiscal year 2022, growing a dramatic +118% vs. Q4 one year ago. Full fiscal year 2022 net revenue growth is expected to finish at a robust +42% vs. fiscal 2021, completing a very strong growth year.

Expected gross profit grew even faster than revenues. The quarter marks the first time that this key metric will have surpassed $500,000, with +127% growth vs. Q4 one year ago. Expected gross profit for the full fiscal year 2022 grew an impressive +47% vs. fiscal 2021.

These preliminary results evidence the Company’s sustained financial performance that we have previously highlighted. Graph 1 below, which was first introduced in my April 5, 2022 CEO Letter has been updated to include the quarterly trailing 12-month figures (TTM) for net revenue and gross profit from September 2019 to June 30, 2022, an analysis period that covers the past three full fiscal years. The figures above each line represent the change vs. prior year for that metric. Additionally, the figures in the green boxes represent the gross profit margin expressed as a % of net revenue.

As communicated previously, TTM net revenues have been increasing consistently between 24% and 53% since Q4 of fiscal 2020 – a period of nine quarters. TTM gross profits have been increasing even more rapidly, and the profit margin on the business has increased significantly from 31% in Q3 2020 to a sustained 52-53% for the last four quarters, including the anticipated Q4 2022 figure. Driving profitable growth is our mission and these key financial metrics indicate that we’ve been successful at that.

Graph 1

To view an enhanced version of Graph 1, please visit:
https://images.newsfilecorp.com/files/5205/139750_7033bedd242ec8a4_001full.jpg

Note: The preliminary fiscal year 2022 and Q4 financial results are unaudited, subject to revision, and anticipated to be finalized and released by late October 2022. The Company’s final audited financial results for the fiscal year 2022 and Q4 could differ materially from these selected preliminary results.

We Implemented a Significant Streamlining of the Vin(Zero) Alcohol-Free Wine Business in Q4

Early in the fiscal year, we began an evaluation of our commercial operating system for Vin(Zero), with many of the recommendations from that program being implemented in Q4. We made major adjustments across all the key areas of production planning, shipping and logistics, warehousing, sales and retail distribution. We expect to see several key positive financial impacts from these changes over time. Importantly, we have:

• shortened our order-to-cash cycle dramatically;
• reduced the level of working capital that we will be holding in finished goods inventory; and
• structured our forecasting, operations planning, and inventory logistics models to create a more efficient shipping cycle that will reduce the need for more expensive temperature-controlled containers for our products.

However, an important by-product of these changes is that we expect to see more dramatic quarter-to-quarter swings on the recognized revenues of this business. As we’ve previously explained, the alcohol-free wine business often had quarterly sales shifts resulting from depleted inventories from supply chain issues or COVID-related delays. These inventory problems often caused additional fees from retailers, multiplying the negative impact of the inefficiencies. It was therefore always our view that it was more accurate to look at the business over time to determine the true sales and financial trends.

In this new streamlined commercial model, we will be placing larger orders less frequently, but more rapidly converting those orders to revenues on the P&L and cash on the balance sheet. As a result, we will provide normalizations and longer-term trend analysis for our investors to better understand the true performance of the business.

Q4 of fiscal 2022 got a boost in estimated revenues because we shifted our model and converted warehoused finished goods inventory to revenue and importantly, into cash. We will provide more detail on those impacts when we release the audited results.

Importantly, while a lot of attention has been placed on the launches of our cannabis projects, the Vin(Zero) business has allowed us to generate cash for operations in a way that many other cannabis-related companies can’t. We continue to believe in the growth opportunity of this business as we continue to expand our view beyond Canada, and we believe that the new model will be a more efficient operational and financial approach to profitably capturing that growth.

DehydraTECH^TM Technology Licensing Business Delivered a Strong Year of Expansion and Growth

As we’ve said before, integrating the DehydraTECH™ licensing business into the Company following our December 2020 acquisition from Lexaria Bioscience Corp. changed our business financially, operationally, and geographically. The DehydraTECH™ rights have allowed us to build plans to fundamentally grow our business beyond Canada into global markets, beyond beverages into cannabis technology, and beyond B2C into B2B scale opportunities as we work to build a global, multi-business company pioneering the space where premium crafted consumer products meet bioscience.

As noted previously, as of July 2021, the Company only had one DehydraTECH™ licensee operating live in-market with DehydraTECH™ THC-infused products – the owner of the “1906 Drops” line of products (“1906“), which were then available in four U.S. states, with 1906’s cannabis-infused chocolate products then also available primarily in Colorado.

By the end of fiscal 2022 our U.S. footprint was up to eight states, representing a population of over 90 million people^[1] (+305% vs. the 29.5MM with which we started the fiscal year) and an addressable market of $19.2B USD^[2] in estimated 2022 total cannabis sales.

With 1906’s expansion into Ohio and Pennsylvania in Q1 of fiscal 2023, we now have an operating footprint in the U.S. covering ten states with a total population of 115MM^[3] and an addressable market of approximately $21.5B USD in estimated 2022 cannabis sales^[4]. That footprint covers states generating almost two-thirds of the addressable market of $33B USD in projected total U.S. cannabis sales for 2022^[5], up from our coverage of less than one-quarter of total U.S. cannabis sales at the beginning of FY 2022.

Expected revenues for fiscal year 2022 from DehydraTECH™ licensing are approximately $550,000 vs. just over $200,000 in fiscal year 2021. As we’ve previously highlighted, in fiscal year 2022, we have not yet realized the full impact of revenues expected from many of the DehydraTECH™ product launches and expansion plans of new and existing licensees that have been announced as they continue to roll out.

Recently Announced Expansions Are Now Hitting the Markets Live:

• 1906 Drops have expanded to Michigan, Pennsylvania, and Ohio in Q1 of fiscal year 2023.
• Lume launched their brand utilizing DehydraTECH™ in Michigan dispensaries in September.
• Neo Alternatives launched their Root 66 brand utilizing DehydraTECH™ in Massachusetts dispensaries in September.
• Folium Farms is expected to launch their Karma brand utilizing DehydraTECH™ in Oregon in early October.

Importantly, this licensing business unit has a very attractive financial structure. It is a low operating expense business, with even lower capital expense required of the Company. As the revenues continue to grow and make up a greater percentage of the total consolidated financials, we expect it to continue to improve the overall financial efficiency metrics of the company and further drive our cash efficiency.

We Are Re-evaluating Our Overall Cannabis Strategy for Canada and Withdrawing Our (V)ia Regal Cannabis Beverage Initiative from the Canadian market

Before discussing the important strategic rationale behind our decision to withdraw our (V)ia Regal cannabis beverage initiative from the Canadian market, it is important to note that the exceptional financial numbers that I have shared earlier in this update do not include any revenues from the sale of (V)ia Regal beverages in Canada. We will provide more details when we release our audited fiscal year 2022 results, but the revenues from our Canadian cannabis beverage business were very disappointing and overall, this has turned out to be an unprofitable initiative for Hill Street due to the complexities of the business system that was put in place.

Our rationale in coming to this decision was based on several factors:

1. The cannabis beverage market is in very early-stage development but is already highly saturated.

Beverages hover around only 2% cannabis market share in Canada and around 1% in the US^[6]. Yet there is an exploding number of distinct products fighting for that small and relatively stable share, increasing from around ten products in June of 2020 to over 100 by January 2022 in the Canadian provinces. That type of competitive intensity often drives price and margin compression as we’ve seen in other markets, as brands pay to secure scarce retail space and drop pricing to compete for consumer purchases.

Based on my almost forty years operating in alcoholic and non-alcoholic beverages across the globe with leading companies and brands, I personally believe that the ready-to-drink (RTD) cannabis beverage market is going to take a longer time and significant capital investment to develop. Large investments in capital equipment for manufacturing have been made by LPs in Canada and the US, but it will also take additional significant investment at retail for cold drink equipment – just as we’ve needed those major investments to drive presence, consumer purchase and growth in other beverage categories.

In addition, RTD beverages have higher costs to transport, warehouse, and stock at retail due to weight and bulk vs. other edible products, so the category will always be competing with more efficient cannabis alternatives for distribution and shelf space.

2. There are significant regulatory challenges in the Canadian cannabis market.

The planning of our (V)ia Regal initiative, like many other cannabis initiatives in Canada, began before cannabis edibles were even legal, and before the final cannabis regulations were published by Health Canada. It is now well known that there are significant regulatory challenges in the Canadian cannabis market with very limited abilities to promote products.

Marketing and promotion in mainstream markets provide necessary navigation for consumers and drive differentiation for brands – it’s not just about delivering a product with a name and a logo. The regulatory limitations on cannabis promotion in Canada make it unfeasible for us to support a premium cost / premium priced product like (V)ia Regal. Because of Health Canada’s interpretation of Canadian cannabis promotion regulations, we have had to withdraw multiple elements of our marketing tools and basic messaging around the core product proposition and ingredients. Our inability to effectively promote the brand was further exacerbated by the complex chain of cannabis licenses needed in the route to market, as we could not operate directly without our own licenses.

3. The (V)ia Regal business system is not financially efficient.

The supply chain and manufacturing model for (V)ia Regal was not financially efficient, unlike the key drivers of our success on our other two business lines. Hill Street took on significant amounts of inventory of alcohol-free wine – the base of the (V)ia Regal product, because of the long lead time order and production cycle for that base material. The alcohol-free wine imported as a bulk wine input into (V)ia Regal has a comparatively shorter shelf life than when imported as our Vin(Zero) finished goods. As we ordered bulk wine inventory based on early aggressive forecasts for the industry and, as early forecasts for the (V)ia Regal business did not materialize, we have had to write off significant amounts of that inventory due to code date expiration and spoilage.

4. The cannabis market size in Canada is relatively small vs. our US DehydraTECH™ opportunity.

The (V)ia Regal business was our first cannabis initiative in Canada and was in development well before we acquired the rights to DehydraTECH™ technology. Canada has a total population of 38MM, with addressable cannabis market sales estimated to be just under CDN $4B² in 2021. Contrast those figures with the US population of 115MM and approximately USD $21.5B market that we are currently operating with our DehydraTECH™ footprint in the US, and it’s clear that the larger opportunity for our resources is DehydraTECH™ in the US. The dramatic difference in the financial efficiency and profitability of the two cannabis businesses amplifies the rationale to prioritize the US DehydraTECH™ business.

While we remain committed to developing quality options for Canadian consumers to have great-tasting drinks with THC, the (V)ia Regal results to date and overall Canadian cannabis beverage market conditions have made it such that we believe it would be prudent for us to withdraw from this market at this time and to redirect our efforts to higher and more efficient returning initiatives in our portfolio.

Therefore, we are announcing today that we have made the decision with our Health Canada‐licensed manufacturing and sales partner Molecule Inc. to no longer produce any additional quantities of (V)ia Regal Pink Grape or White Grape sparklers, the two products that we launched together. Once existing inventories of (V)ia Regal products are sold through, they will no longer be available for sale in Canada.

Our Longer-Term View of Winning Consumer Occasions with Cannabis Beverages

While we are withdrawing from the RTD cannabis beverage business in Canada at this time, we do believe that there will be global opportunities for this business in the future, as the category and commercial systems more fully develop. At the appropriate time, we expect to return to product R&D and concept development on the cannabis infused RTD beverage category utilizing our patented DehydraTECH™ technology as the backbone vs. the other technologies and ingredient systems being used across the current RTD cannabis beverage market.

In the meantime, we also continue to work on securing a licensed partner in Canada that could support a DehydraTECH™ manufacturing operation, which would allow us to potentially launch a consumer form factor that could be mixed into a consumer’s favorite drink to win occasions. Interestingly, drops, mixes, elixirs and syrups are the largest segment of the cannabis beverage category in the US markets, and we are continually expanding our experience and knowledge base in those segments as we work with our US DehydraTECH™ licensees. These form factors leverage the infrastructure and presence of existing RTD beverages in the market – both at home and on premise – and allow for more individual customization of consumer beverages to their favorite types and flavors that they already buy and consume.

Lastly, we continue to evaluate options for our Mississauga, Ontario Lucknow facility but have paused any additional investments through the end of calendar 2022, as we utilize our cash on initiatives that have a higher and more immediate return.

We Continue to Make Progress on Building Our Corporate Reputation

As mentioned in the August update, we have now done significant work internally on the Hill Street corporate reputation strategies and plans for both B2B industry awareness and investor relations support. We are actively working with The Panther Group to help drive many of these reputation-building activities with us through their network and programs. We worked closely with them to make additional connections and introductions at two events in September 2022 – the Benzinga Capital Conference in Chicago and MJ Unpacked in Las Vegas. We will share additional programs and materials as they develop, but we believe that our exceptional business performance provides a strong foundation on which to expand and amplify our awareness and reputation.

Summary

In summary, we had a transformative fiscal year 2022 with major operational advances leading to the outstanding financial performance that we’ve previewed here. We enter fiscal year 2023 with the impact of many of those fiscal 2022 operating successes expected to hit our financial results in FY 2023, as well as several important new wins that have already kicked off this fiscal year.

We appreciate your support and hope you share our excitement about the FY22 financial results and the coming year.

Sincerely,

Craig Binkley, CEO

About Hill Street Beverage Company Inc. (TSXV: HILL)

Hill Street Beverage Company Inc. is a progressive non-alcoholic beverage and cannabis solutions company. We are pioneering the space where craft consumer products meet bioscience by combining our deep CPG expertise and our rights to use Lexaria Bioscience Corp.’s ground-breaking DehydraTECH™ patent portfolio for product development, licensing and B2B sales of cannabis ingredients.

For more information on our business activities or to check out Hill Street’s award-winning alcohol-free line-up and order product to be delivered straight to your home go to https://hillstreetbeverages.com/wines/.

For more information:

Craig Binkley, Chief Executive Officer
craig@hillstreetbevco.com.

FORWARD-LOOKING STATEMENTS

Statements in this press release may contain forward-looking information. Any statements in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as “may”, “should”, “would”, “anticipate”, “expects”, and similar expressions. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances, such as future availability of capital on favourable terms, may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement. The forward-looking statements contained in this press release are made as of the date of this press release. The Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as required by securities law.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Not for dissemination in the United States.

^[1] US Census Bureau, https://www.census.gov/quickfacts/fact/table/US/PST045221
^[2] MJBiz Factbook 2022
^[3] US Census Bureau, https://www.census.gov/quickfacts/fact/table/US/PST045221
^[4] MJBiz Factbook 2022
^[5] MJBiz Factbook 2022
^[6] “Cannabis Beverages: A look at category trends & performance”, Headset 2022 Report, https://www.headset.io/industry-reports/cannabis-beverages-a-look-at-category-trends-performance#form

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/139750