Mr. Brian Keane reports

CYPHER METAVERSE INC. ANNOUNCES LETTER OF INTENT FOR PROPOSED BUSINESS COMBINATION WITH AGAPI LUXURY BRANDS INC.

Cypher Metaverse Inc. has entered into a binding letter of intent dated May 10, 2023, to enter into a business combination with Agapi Luxury Brands Inc. It is expected that upon completion of the transaction, the combined entity will meet the listing requirements for an industrial issuer and constitute a reverse takeover under the policies of the Canadian Securities Exchange.

Terms of the transaction

The transaction is expected to be completed by way of a three-cornered amalgamation, share purchase, share exchange or alternative transaction to be determined with input from the legal and tax advisers to each of Cypher Metaverse and Agapi, which will result in Agapi becoming a wholly owned subsidiary of Cypher Metaverse.

Upon the satisfaction or waiver of the conditions set out in the definitive transaction agreement to be entered into by Cypher Metaverse and Agapi, the following, among other things, will be completed in connection with the transaction:

• The holders of Agapi common shares will receive 0.7601 common share of the resulting issuer in exchange for each of their Agapi common shares.
• All outstanding Cypher Metaverse warrants will be replaced with equivalent convertible or exchangeable securities of the resulting issuer, entitling the holders thereof to acquire common shares of the resulting issuer.
• The management and board of directors of the resulting issuer will be determined by Agapi and announced in further press releases.
• Cypher Metaverse will change its name to such name as determined by Agapi in its sole discretion in compliance with applicable law and as may be acceptable to the Canadian Securities Exchange.

The transaction is a non-arm's-length transaction or a related-party transaction pursuant to the policies of the CSE and National Instrument 61-103 as the chief executive officer of Cypher Metaverse is a significant shareholder of Agapi. As a result, Cypher Metaverse is being represented in these negotiations by a special committee made up of independent directors. In addition, the company has commissioned an independent valuation of Agapi and will seek the approval of disinterested shareholders.

Private placement financing

In connection with and as a condition to the transaction, Agapi intends to complete an equity financing of Agapi common shares for gross proceeds of up to $750,000. It is expected that the issue price per Agapi common share will be 10 cents. The Agapi common shares are expected to be sold to accredited investors and other parties pursuant to exemptions from prospectus requirements under Canadian securities laws.

The private placement is intended to be completed prior to or concurrently with closing of the transaction. The net proceeds of the private placement will be used for working capital and general corporate purposes.

The ultimate structuring of the private placement is subject to receipt of tax, securities law and corporate law advice.

Conditions of the transaction

Completion of the transaction is subject to the satisfaction of customary closing conditions, including: (i) the satisfactory completion of due diligence by each of Cypher Metaverse and Agapi; (ii) receipt of all required approvals and consents relating to the transaction, including without limitation any approvals of the shareholders of Cypher Metaverse and Agapi as required by the CSE and under applicable corporate or securities laws; (iii) completion of the private placement; and (iv) the CSE's approval for listing the shares of the resulting issuer.

Bridge loan

Cypher Metaverse has agreed to lend Agapi $600,000 by way of a secured bridge loan at an annual interest rate of 8 per cent. The bridge loan will be forgiven by Cypher Metaverse upon completion of the transaction. The bridge loan will be repayable within six months of termination of the definitive agreement in accordance with its terms. Final terms of the bridge loan will be set out in a definitive loan agreement and related security documentation, which will contain such terms as are customary in comparable transactions.

The bridge loan will be used by Agapi for working capital and general corporate purposes.

Trading halt

Trading in Cypher Metaverse common shares on the CSE will remain halted in compliance with the policies of the CSE in connection with the announcement of the transaction as this would be a change of business under the policies of the CSE, and is expected to remain halted pending the review of the transaction by the CSE and satisfaction of the conditions of the CSE for resumption of trading. It is not expected that trading in the Cypher Metaverse common shares will resume prior to the closing.

Filing statement

In connection with the transaction and in compliance with the policies of the CSE, Cypher Metaverse will file on SEDAR a filing statement or information circular, which will contain details regarding the transaction, Cypher Metaverse, Agapi and the resulting issuer.

Additional information

If and when a definitive agreement is executed, Cypher Metaverse will issue a subsequent press release containing details of the definitive agreement and additional terms of the transaction, including information relating to summary financial information in respect of Agapi, and, to the extent not contained in this press release, additional information with respect to the private placement, history of Agapi, and the proposed directors, officers and insiders of the resulting issuer upon completion of the transaction.

About Cypher Metaverse Inc.

Cypher Metaverse seeks early-stage investments in emerging technology sectors, including the blockchain ecosystem, fintech and the metaverse. The company identifies such opportunities and applies its relationships and capital to advance its interests.

The common shares of Cypher Metaverse are currently listed on the CSE, and Cypher Metaverse is a reporting issuer in the provinces of British Columbia, Alberta and Ontario.

Cypher Metaverse currently has 15,571,906 Cypher Metaverse common shares issued and outstanding and securities exercisable or exchangeable into 3,288,070 Cypher Metaverse common shares.

About Agapi Luxury Brands Inc.

Agapi's premium luxury branded cigars sold under the brand Freud Cigar Co., are exclusively handcrafted using the finest tobacco leaves that are carefully selected and aged to perfection, and artistically blended to produce an unforgettable smoking experience for the luxury consumer. The company has partnered with renowned industry veterans Eladio Diaz and William Ventura with the aim to disrupt the luxury cigar segment. The company has commercialized products in the U.S. and international markets selling over 40,000 and 10,000 cigars in each respective market.

Agapi is a private company and was incorporated under the Business Corporations Act (British Columbia) on June 11, 2021.

Agapi currently has approximately 65,571,906 common shares issued and outstanding and securities exercisable or exchangeable into approximately 84,542,058 Agapi common shares.

All information in this press release relating to Agapi has been provided by Agapi and is the sole responsibility of Agapi.

We seek Safe Harbor.