Hypha Labs (OTCMKTS:DIGP) Secures Investment as Chairman Purchases Series C Preferred Stock

Hypha Labs, Inc. recently finalized a significant transaction as outlined in an 8-K filing submitted to the Securities and Exchange Commission on December 10, 2024. The Nevada-based company, Hypha Labs, disclosed that it had entered into a Securities Purchase Agreement with A. Stone Douglass, the current Chairman, President, Chief Executive Officer, Chief Financial Officer, and Secretary of the company.

The agreement detailed that Mr. Douglass acquired 1,000 shares of the company’s newly issued Series C Preferred Stock at a rate of $0.10 per share. A notable feature of the Series C Preferred Stock is that it grants the holder, as long as they remain an executive officer of the company, the privilege to vote alongside common stockholders, with a weight of 200,000 votes per share of Series C Preferred Stock. These shares cannot be converted into common stock, do not entitle holders to dividends, and possess a stated value of $0.10 per share, payable preferentially in the event of a company liquidation.

The Hypha Labs board of directors has determined that expanding the authorized shares of common and preferred stock is crucial for the company’s financial flexibility and capital-raising efforts. The augmentation of authorized shares, from 250,000,000 shares to 880,000,000 shares for common stock and from 10,000,000 shares to 70,000,000 shares for preferred stock, is aimed at facilitating conversions of existing convertible securities, granting restricted stock, and incentivizing stock options.

To expedite this strategic move and avoid complexities associated with obtaining stockholder approval for the proposed amendments to the company’s Articles of Incorporation, the board elected to sell the Series C Preferred Stock to Mr. Douglass. This decision allows him to wield a majority of the company’s voting stock to secure approval for the necessary amendments.

The company’s filing also revealed that Mr. Douglass, by written consent, approved the proposed Amendment on December 10, 2024, within his capacity as the sole holder of the Series C Preferred Stock and the majority voter of the company’s stock. The effective implementation of the Amendment is subject to further filing with the Secretary of State of Nevada.

For a comprehensive understanding of the terms governing the Series C Preferred Stock, interested parties are directed to refer to the Certificate of Designation specifying the unique characteristics of the stock, filed as Exhibit 3.1 in the previous Current Report on Form 8-K lodged with the Securities and Exchange Commission on July 26, 2022.

Moreover, the issuance of these equity securities was conducted in compliance with the exemption outlined in Section 4(a)(2) of the Securities Act of 1933, exempting the offer and sale of securities from public trading requirements.

Investors and stakeholders can access additional information regarding this transaction through the Securities Purchase Agreement between Hypha Labs, Inc. and A. Stone Douglass, documented as Exhibit 10.1 in the 8-K filing. Furthermore, a Cover Page Interactive Data File (embedded within the Inline XBRL document) is available as Exhibit 104.

The progressive steps taken by Hypha Labs signal strategic foresight and an emphasis on fortifying the company’s financial structure and operational potential in the market landscape.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read Hypha Labs’s 8K filing here.

Hypha Labs Company Profile

Hypha Labs, Inc, cultivates, produces, and sells psychedelic and functional mushroom in the United States. It has developed technology that quickly cultivates the mycelium root structures of psilocybin mushrooms and other functional mushroom's mycelium into a natural product. The company was incorporated in 2010 and is headquartered in Las Vegas, Nevada.