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PRESS RELEASE: Hydro66 Announces Entering into of Convertible Loan Agreement

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DGAP-News: Hydro66 Holdings Corp. / Key word(s): Miscellaneous
Hydro66 Announces Entering into of Convertible Loan Agreement

2020-03-31 / 23:15
The issuer is solely responsible for the content of this announcement.

Toronto, Ontario(Newsfile Corp. - March 31, 2020) - Hydro66 Holdings Corp.
*(CSE: SIX) *(the "*Company*" or "*Hydro66*") is pleased to announce that
today it has entered into a secured convertible loan agreement with David
Rowe, a significant shareholder and a director of the Company, and with
Robert Keith, a significant shareholder of the Company (the "*Loan
Agreement*").

The maximum amount of the loan will be USD$1,000,000 (the "*Loan*") in the
aggregate, convertible at the market price of the common shares at the date
of conversion, with the initial advance of USD$300,000 to be advanced on or
before April 6, 2020 (using a Bank of Canada exchange rate on March 27, 2020
for conversion of amounts advanced in USD to Canadian dollars) (the
"*Initial Advance*"). The remaining amounts of the Loan may be requested by
the Company, if necessary, on or before December 31, 2021, in the same
amounts as advanced by such lender under the Initial Advance. The Company
will request that any amount advanced be made in Canadian dollars, however,
the Company acknowledges that the lenders may make advances in either
British Sterling or USD.

The Loan will be evidenced by second ranking secured convertible promissory
notes in favour of the lenders for each advance under the Loan (the
"*Notes*"). The maturity date of the principal amount, interest and any fees
of the Loan is seven (7) years from the date of the Initial Advance and the
rate of interest is 10% per annum. The interest for the initial two (2)
years of the Loan shall not be payable until such time as the Loan is repaid
in full.

The Loan will be secured by a general security interest, ranking second to a
previous secured loan granted by the Company in 2018, over all of the assets
of the Company, and through a guarantee of the Company's operating
subsidiary in Sweden. Under the general security agreement, the Company will
agree, among other things, to not pledge, sell, lease or otherwise dispose
of its assets, other than in the normal course, without prior written
consent of the Note holder.

The Notes issued pursuant to the transaction and any Common Shares issued on
conversion of the Notes will be subject to a statutory hold period in Canada
of four months and one day following the issuance of the Notes in accordance
with applicable securities laws. Additional resale restriction may be
applicable under the laws of other jurisdictions.

The transaction constituted a related party transaction within the meaning
of Multilateral Instrument 61-101 ("*MI 61-101*") as certain insiders of the
Company agreed to advance USD$1,000,000 in connection with the Loan (using a
Bank of Canada exchange rate on March 27, 2020 for conversion of amounts
advanced in USD to Canadian dollars). The Company is relying on the
exemptions from the valuation and minority shareholder approval requirements
of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101, as the
fair market value of the participation in the transaction by the insiders
does not exceed 25% of the market capitalization of the Company, as
determined in accordance with MI 61-101. The Company did not file a material
change report in respect of the related party transaction at least 21 days
before the closing of the first advance of the Loan, which the Company deems
reasonable in the circumstances in order to complete the transaction in an
expeditious manner.

Immediately prior to the execution of the Loan Agreement, David Rowe had
ownership and control over a total of 51,233,650 common shares of the
Company, representing 39.21% of the issued and outstanding common shares.
Assuming a conversion by Mr. Rowe of all of the amounts owing or potentially
owing under the Loan Agreement, using a Bank of Canada exchange rate on
March 27, 2020 and a conversion price for all amounts under the Loan
Agreement of C$0.09 per share being the trading price of the common shares
on close of business day immediately prior to the entering of the Loan
Agreement, Mr. Rowe would acquire ownership and control over a total of
8,995,840 common shares of the Company, representing 6.44% of the issued and
outstanding common shares. Immediately following such conversion, together
with the common shares already owned by Mr. Rowe and assuming conversion of
convertible securities of the Company held by Mr. Rowe, Mr. Rowe would have
ownership and control over 85,197,019 common shares of the Company,
representing 44.94% of the issued and outstanding common shares on a
partially diluted basis.

Immediately prior to the execution of the Loan Agreement, Robert Keith had
ownership and control over a total of 37,523,574 common shares of the
Company, representing 28.72% of the issued and outstanding common shares.
Assuming a conversion by Mr. Keith of all of the amounts owing or
potentially owing under the Loan Agreement, using a Bank of Canada exchange
rate on March 27, 2020 and a conversion price for all amounts under the Loan
Agreement of C$0.09 per share being the trading price of the common shares
on close of business day immediately prior to the entering of the Loan
Agreement, Mr. Keith would acquire ownership and control over a total of
6,621,937 common shares of the Company, representing 4.82% of the issued and
outstanding common shares. Immediately following such conversion, together
with the common shares already owned by Mr. Keith and assuming conversion of
convertible securities of the Company held by Mr. Keith, Mr. Keith would
have ownership and control over 60,215,505 common shares of the Company,
representing 35.54% of the issued and outstanding common shares on a
partially diluted basis.

The Note is intended to be acquired for investment purposes. Messrs. Rowe
and Keith have a long-term view of the investment and may acquire additional
securities of the Company either on the open market or through private
acquisitions or sell securities of the Company either on the open market or
through private dispositions in the future depending on market conditions,
reformulation of plans and/or other relevant factors. A copy of Messrs. Rowe
and Keith's early warning report will appear on the Company's profile on
SEDAR within two days following the issuance of the Note and may also be
obtained at such time by calling (416) 361-2817 (Suite 401, 217 Queen Street
West, Toronto, Ontario, M5V 0R2).

*About Hydro66*

Hydro66 owns and operates an award-winning colocation data centre in Sweden
specializing in High Performance Computing ("HPC") hosting. The Company
hosts third party IT infrastructure, utilizing 100% green power, at amongst
the EU's lowest power prices and within an ISO27001 accredited facility.

Hydro66 is uniquely positioned to capitalize on opportunities in blockchain
infrastructure as well as the traditional Enterprise colocation data centre
market. The Company provides truly green power at a leading price,
purpose-built space and cooling, telecoms, IT support services and 24/7
physical security in their facility in Boden, Sweden.

For more information please visit: www.hydro66.com [1]

*FOR MORE INFORMATION, PLEASE CONTACT:*

Paul Morrison
Chief Commercial Officer of Hydro66 UK Limited

paul.morrison@hydro66.com [2]
(+44) 7789 915 147

or

Jason Atkinson
Director of Corporate Development

Jason.atkinson@hydro66.com [3]
(647) 938-5266

_Neither the CSE nor its Regulation Services Provider accepts responsibility
for the adequacy or accuracy of this release._

*Forward-Looking Information*

Certain information set forth in this news release may contain
forward-looking statements that involve substantial known and unknown risks
and uncertainties. All statements other than statements of historical fact
are forward-looking statements, including, without limitation, statements
regarding future financial position, business strategy, use of proceeds,
corporate vision, proposed acquisitions, partnerships, joint-ventures and
strategic alliances and co-operations, budgets, cost and plans and
objectives of or involving the Company. Such forward-looking information
reflects management's current beliefs and is based on information currently
available to management. Often, but not always, forward-looking statements
can be identified by the use of words such as "plans", "expects", "is
expected", "budget", "scheduled", "estimates", "forecasts", "predicts",
"intends", "targets", "aims", "anticipates" or "believes" or variations
(including negative variations) of such words and phrases or may be
identified by statements to the effect that certain actions "may", "could",
"should", "would", "might" or "will" be taken, occur or be achieved. A
number of known and unknown risks, uncertainties and other factors may cause
the actual results or performance to materially differ from any future
results or performance expressed or implied by the forward-looking
information. These forward-looking statements are subject to numerous risks
and uncertainties, certain of which are beyond the control of the Company
including, but not limited to, the impact of general economic conditions,
industry conditions and dependence upon regulatory approvals. Certain
material assumptions regarding such forward-looking statements may be
discussed in this news release and the Company's annual and quarterly
management's discussion and analysis filed at www.sedar.com [4]. Readers are
cautioned that the assumptions used in the preparation of such information,
although considered reasonable at the time of preparation, may prove to be
imprecise and, as such, undue reliance should not be placed on
forward-looking statements. The Company does not assume any obligation to
update or revise its forward-looking statements, whether as a result of new

(MORE TO FOLLOW) Dow Jones Newswires

March 31, 2020 17:15 ET ( 21:15 GMT)
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