Mr. Tomer Bar Meir reports

ESHBAL ANNOUNCES CLOSING OF PRIVATE PLACEMENT

Eshbal Functional Food Inc. has completed the first closing of its recently announced non-brokered private placement.

Further to its press release of Thursday, Jan. 22, 2026, Eshbal has closed an initial tranche of its previously announced non-brokered private placement offering of 4,245,117 units with gross proceeds of $721,670. Each unit consisted of one common share of the company and one full common share purchase warrant. Each warrant entitles the holder to purchase one additional common share at an exercise price of 30 cents until Feb. 10, 2028. All securities issued under the offering are subject to resale restrictions of until June 11, 2026, in accordance with applicable securities laws.

The proceeds from the offering will be used to advance acquisition opportunities that have been identified as part of the company's previously stated roll-up strategy within the gluten-free industry. The proceeds will also be used for continuing product development and project and working capital. In connection with the offering, the company paid an aggregate of $10,721 and issued 63,070 warrants to Haywood Securities Inc.

The company may seek to complete additional closings of the offering.

"Eshbal is in discussions with several companies in support of its roll-up strategy in the artisanal gluten-free industry. The proceeds of this private placement will help accelerate this strategy to drive the scale and manufacturing efficiencies that are needed by mainstream grocers," said Tomer Bar Meir, chief executive officer of Eshbal.

About Eshbal Functional Food Inc.

Eshbal Functional Food is an innovative and profitable food-technology company that focuses on the gluten-free and better-for-you categories. Eshbal is pursuing a roll-up strategy in the fragmented, artisanal gluten-free market to create a platform that delivers the scale needed by mainstream grocers. Its recent agreement with Dare 2 Be Different Foods gives the company potential distribution in Walmart and 300-plus other stores in the northeastern United States.

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