Mr. Andrew Barnes reports

COHO ANNOUNCES AMENDED TERMS FOR ACQUISITION OF PUREBREAD AND EQUITY FINANCING

Coho Collective Kitchens Inc. has provided an update on the acquisition of Purebread. Bakery Inc. that was previously announced on May 29, 2023. As announced on Aug. 31, 2023, the acquisition, a strategic move expected to bolster Coho's market presence, is now expected to close on or before Sept. 19, 2023. Coho is also pleased to announce today that Purebread's existing owners (collectively, the Purebread vendors) have also agreed to receive a portion of the purchase price for Purebread in the form of a $1.5-million vendor-takeback note (the VTB note) issued by Coho Acquisition Corp. (the purchaser).

The VTB note was negotiated between Coho and the Purebread vendors to ensure a seamless transition and continued growth of Purebread following the date of the concurrent closings of the offering (defined herein) and acquisition. This amendment to the terms of the acquisition demonstrates the confidence of the Purebread vendors in the future success of Purebread following the closing date. It also better aligns the interests of the Purebread vendors with those of Coho and its shareholders.

Further to Coho's previous announcement on July 31, 2023, Coho has also filed a new offering document dated Sept. 12, 2023, to replace for all intents and purposes the offering document filed and announced on July 31, 2023, which was set to expire on Sept. 14, 2023.

Updated equity financing

The company is conducting a new brokered private placement of up to 35,294,117 units of the company at a price of 17 cents per unit, for aggregate gross proceeds of up to $6-million. This offering replaces for all purposes the offering announced by the company on July 31, 2023, in order for the company to make the offering of units to purchasers resident in Canada, except Quebec, pursuant to the listed issuer financing exemption under Part 5A of National Instrument 45-106 -- Prospectus Exemptions, subject to compliance with applicable regulatory requirements and in accordance with NI 45-106.

A maximum of 29,411,765 units will be issued pursuant to the listed issuer financing exemption. The balance of the units will be issued pursuant to other exemptions from the prospectus requirements found in NI 45-106.

Each unit will be composed of one common share in the capital of the company and one-half of one common share purchase warrant. Each warrant will entitle the holder thereof to acquire one additional common share at a price of 25 cents per warrant share for a period of 36 months from the closing date.

The company intends to use the net proceeds of the offering for completing its previously announced acquisition of Purebread, the expansion of operations and to provide general working capital to support operations.

In connection with the offering, Coho has entered into an agreement with Canaccord Genuity Corp., dated June 14, 2023, pursuant to which Canaccord will act as lead agent to assist the company with the offering on a reasonable efforts basis. On the closing date, the company shall pay to the lead agent (together with any selling group formed by the lead agent, the agents): (i) a cash commission equal to 8.0 per cent of the aggregate gross proceeds of the offering payable in cash or units, or any combination of cash or units at the option of the lead agent and (ii) common share purchase warrants of the company, exercisable at any time prior to the date that is 36 months from the closing date to acquire that number of units equal to 8.0 per cent of the number of units issued under the offering, at an exercise price equal to the issue price. On the closing date, the company shall also pay the lead agent a corporate finance fee consisting of (i) $50,000 (payable in cash) and (ii) 294,117 units (having a value equal to $50,000).

The company may provide a president's list of investors that can subscribe for up to $2-million of the offering. The compensation to the agents for subscribers on the president's list shall be reduced to 3 per cent for both cash commission and agent's warrants.

Subject to compliance with applicable regulatory requirements, and in accordance with NI 45-106, the offering of units is being made to purchasers resident in Canada, except Quebec, pursuant to the listed issuer financing exemption. The units will not be subject to a hold period in accordance with applicable Canadian securities laws. There is an offering document related to the offering that can be accessed under the company's profile at SEDAR+ and on the company's website. Prospective investors should read this offering document before making an investment decision.

The company expects to close the offering on or about Sept. 19, 2023, and the offering is subject to certain conditions including, but not limited to, the receipt of all necessary regulatory approvals including the approval of the TSX Venture Exchange.

Extension of outside date of acquisition

As detailed in Coho's announcement on Aug. 31, 2023, the company and the Purebread vendors have also agreed to extend the outside date of the definitive purchase agreement executed in connection with the acquisition from Aug. 31, 2023, to Sept. 19, 2023. The extension will allow Coho and the Purebread vendors to finalize remaining documentation and facilitate concurrent closings of the acquisition and the offering, term credit facility, and revolving credit facility necessary to support the acquisition. The term credit facility and revolving credit facility are further described in the company's news release dated May 29, 2023.

Other than the extension and the VTB note, the purchase agreement is otherwise unamended as of the date hereof and the acquisition is expected to proceed substantially on the terms previously announced.

Details of VTB note

The purchaser, a wholly owned subsidiary of Coho, will issue the VTB note in favour of Twin Lakes Investments Inc., one of the Purebread vendors. The VTB note will be secured by a general security agreement granted by the purchaser and Purebread in favour of Twin Lakes. Purebread will also be executing a guarantee and indemnity for the obligations of the purchaser to Twin Lakes.

All principal and interest owing in connection with the VTB note must be repaid by the date that is 24 months after the closing date. The VTB note may be prepaid by Coho in full without penalty at any time during the term. The VTB note shall initially bear interest at a rate of 10 per cent for the 12-month period commencing on the closing date and is subject to adjustment following the initial interest rate period (as detailed by Coho in the offering document).

About Coho Collective Kitchens Inc.

Coho is a growing player in commercial real estate and food technology, operating fast casual restaurants and shared-kitchen facilities. As Canada's largest shared-kitchen company, Coho is expanding its presence and services. Through combined efforts, Coho and Purebread strive to positively impact the communities in which they operate.

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