Mr. Christian Bullock reports

PUREBREAD BRANDS INC. ANNOUNCES CLOSING OF PREVIOUSLY ANNOUNCED DEBT SETTLEMENT

Purebread Brands Inc., further to the company's news release on April 8, 2026, has completed its previously announced share-for-debt transaction and issued an aggregate of 20 million units of the company to certain creditors, at a price of 15 cents per settlement unit, in full and final settlement of accrued and outstanding indebtedness in the aggregate amount of $3-million. Each settlement unit comprises one common share in the capital of the company 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 30 cents 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 Dec. 24, 2025, an arm's-length party to the company purchased for $3-million aggregate indebtedness of $5,209,930 previously owed by the company's subsidiary, Coho Acquisition Corp., to 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 with respect to $3-million of the original indebtedness, and the original creditor entered into assignment and assumption agreements with the creditors, none of which were non-arm's-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 to the original creditor.

Since Sept. 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., a creditor, is considered to be a related party transaction as defined under Multilateral Instrument 61-101, Protection of Minority Securityholders in Special Transactions. 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 per cent and a partially diluted ownership interest of 11.74 per cent. 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 per cent and 14.50 per cent of the issued and outstanding common 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 is now an insider of the company as defined under MI 61-101. Immediately prior to the closing of the debt settlement, Ms. Kuzina held 200,000 common shares and 100,000 convertible securities, reflecting an undiluted ownership interest of 0.46 per cent and a partially diluted ownership interest of 0.68 per cent. Ms. Kuzina was issued 9,511,113 settlement units pursuant to the debt settlement and Ms. 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 per cent and a partially diluted ownership interest of 21.23 per cent.

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

As a result of the debt settlement, Vladimir Kuzin is now an insider of the company as defined under MI 61-101. Immediately prior to the closing of the debt settlement, Mr. Kuzin held 51,000 common shares and nil convertible securities, reflecting an undiluted ownership interest of 0.12 per cent. Mr. Kuzin was issued 5.85 million settlement units pursuant to the debt settlement and Mr. 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 per cent and a partially diluted ownership interest of 13.23 per cent.

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

About Purebread Brands Inc.

Purebread Brands is a Canada's premium artisan bakery and cafe brand, operating seven 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.

We seek Safe Harbor.