Vancouver, British Columbia--(Newsfile Corp. - September 2, 2026) - Purebread Brands Inc. (TSXV: BRED) ("Purebread" or the "Company") is pleased to announce that, further to the Company's news release on April 8, 2026, it has completed its previously announced shares for debt transaction and issued an aggregate of 20,000,000 units of the Company (the "Settlement Units") to certain creditors (the "Creditors"), at a price of $0.15 per Settlement Unit, in full and final settlement (the "Debt Settlement") of accrued and outstanding indebtedness in the aggregate amount of $3,000,000 (the "Settled Debt"). Each Settlement Unit is comprised of one common share in the capital of the Company (each, a "Common Share") and one-half of one Common Share purchase warrant, with each whole warrant exercisable by the holder to acquire one Common Share at an exercise price of $0.30 per Common Share for a period of 24 months from the date of issuance. Following completion of the Debt Settlement and the issuance of the Settlement Units, there are an aggregate of 63,768,149 Common Shares issued and outstanding.

All securities issued pursuant to the Debt Settlement are subject to a four-month hold period from the date of issuance in accordance with applicable Canadian securities laws, in addition to such other restrictions as may apply under applicable securities laws of jurisdictions outside Canada.

Background to Debt Settlement

On December 24, 2025, an arms' length party to the Company (the "Original Creditor") purchased for $3,000,000, aggregate indebtedness of $5,209,930 (the "Original Indebtedness") previously owed by the Company's subsidiary, Coho Acquisition Corp., to the Bank of Montreal ("BMO"), pursuant to a letter of agreement dated June 28, 2023, as amended. Subsequently, the Company assumed all of the rights, covenants and obligations of Coho Acquisition Corp. with respect to $3,000,000 of the Original Indebtedness, and the Original Creditor entered into assignment and assumption agreements with the Creditors, none of which were "Non-Arms' Length Parties" (as such term is defined under the policies of the TSX Venture Exchange) to the Company at the time of such assignment, pursuant to which the Original Creditor assigned to the Creditors the Settled Debt.

Following completion of the Debt Settlement, the aggregate principal amount of $2,209,930, together with accrued interest thereon, remains outstanding and owing by Coho Acquisition Corp. to the Original Creditor.

Since September 26, 2025, the Company has considerably improved its balance sheet position through the settlement of an aggregate of $10,373,667.20 of indebtedness through the issuance of 27,014,048 Common Shares and 13,240,863 Common Share purchase warrants of the Company.

Related Party Transaction and Insider Participation

The issuance of Settlement Units to Wevers Holdings Ltd. ("Wevers"), a Creditor, is considered to be a "related party transaction" as defined under Multilateral Instrument 61-101 - Protection of Minority Securityholders in Special Transactions ("MI 61-101"). The issuance of Settlement Units, as it relates to Wevers, is exempt from the minority approval and formal valuation requirements of MI 61-101 pursuant to subsections 5.5(a) and 5.7(1)(a) of MI 61-101. Immediately prior to closing of the Debt Settlement, Wevers held 3,901,150 Common Shares and securities convertible to acquire 1,403,925 Common Shares, reflecting an undiluted ownership interest of 8.91% and a partially diluted ownership interest of 11.74%. Wevers was issued 3,072,220 Settlement Units pursuant to the Debt Settlement and Wevers continues to be a related party on the basis of holding 6,973,370 Common Shares and securities convertible to acquire 2,940,035 Common Shares, reflecting an undiluted ownership interest of 10.94% and 14.50% of the issued and outstanding Comon Shares on a partially diluted basis.

The Company anticipates that Wevers will file an early warning report on the Company's profile on SEDAR+.

As a result of the Debt Settlement, Ekaterina Kuzina ("Kuzina"), is now an "insider" of the Company as defined under MI 61-101. Immediately prior to the closing of the Debt Settlement, Kuzina held 200,000 Common Shares and 100,000 convertible securities, reflecting an undiluted ownership interest of 0.46% and a partially diluted ownership interest of 0.68%. Kuzina was issued 9,511,113 Settlement Units pursuant to the Debt Settlement and Kuzina holds 9,711,113 Common Shares and securities convertible to acquire 4,855,556 Common Shares, reflecting an undiluted ownership interest of 15.23% and a partially diluted ownership interest of 21.23%.

The Company anticipates that Kuzina will file an early warning report on the Company's profile on SEDAR+.

As a result of the Debt Settlement, Vladimir Kuzin ("Kuzin"), is now an "insider" of the Company as defined under MI 61-101. Immediately prior to the closing of the Debt Settlement, Kuzin held 51,000 Common Shares and nil convertible securities, reflecting an undiluted ownership interest of 0.12%. Kuzin was issued 5,850,000 Settlement Units pursuant to the Debt Settlement and Kuzin holds 5,901,000 Common Shares and securities convertible to acquire 2,925,000 Common Shares, reflecting an undiluted ownership interest of 9.25% and a partially diluted ownership interest of 13.23%.

The Company anticipates that Kuzin will file an early warning report on the Company's profile on SEDAR+.

About Purebread Brands Inc.:

Purebread Brands Inc. is a Canada's premium artisan bakery and cafe brand, operating 7 locations across British Columbia and building a national platform for premium baked goods and cafe experiences. With a vision to grow nationally, Purebread is building the team and infrastructure to drive retail expansion in vibrant communities across Canada and beyond.

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

Cautionary Note Regarding Forward-Looking Statements

This release includes certain statements and information that may constitute forward-looking information within the meaning of applicable Canadian securities laws. Forward-looking statements relate to future events or future performance and reflect the expectations or beliefs of management of the Company regarding future events. Generally, forward-looking statements and information can be identified by the use of forward-looking terminology such as "intends" or "anticipates", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "should", "would" or "occur". This information and these statements, referred to herein as "forward‐looking statements", are not historical facts, are made as of the date of this news release and include without limitation, discussions of future plans, estimates and forecasts and statements as to management's expectations and intentions with respect to, among other things: the Company's intentions with respect to building a national platform for premium baked goods and café experiences, the Company's intention to grow nationally within Canada and beyond, the Company's intentions to build its team and infrastructure to drive retail expansion and the Company's expectation that each of Wevers, Kuzina and Kuzina will file early warning reports in respect of the Debt Settlement.

These forward‐looking statements involve numerous risks and uncertainties and actual results might differ materially from results suggested in any forward-looking statements. These risks and uncertainties include, among other things, the risks that: the Company is unable to building a national platform for premium baked goods and café experiences, the Company in unable to continue to grow nationally within Canada and beyond, the Company is unable to build its team and infrastructure or that such actions will not drive retail expansion, and that Wevers, Kuzin and Kuzina, or any of them, fail to file early warning reports in respect of the Debt Settlement.

In making the forward looking statements in this news release, the Company has applied several material assumptions, including without limitation, that the Company will be able to build a national platform for premium baked goods and café experiences, that the Company will grow nationally within Canada and beyond ,that the continued building of the Company's team and infrastructure will drive retail expansion and that each of Wevers, Kuzina and Kuzina will file early warning reports in respect of the Debt Settlement.

Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such 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 and forward-looking information. Readers are cautioned that reliance on such information may not be appropriate for other purposes. The Company does not undertake to update any forward-looking statement, forward-looking information or financial out-look that are incorporated by reference herein, except in accordance with applicable securities laws.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/312275