Mr. Bill Besenhofer reports

THE FRESH FACTORY ANNOUNCES CLOSING OF US$3-MILLION NON-BROKERED PRIVATE PLACEMENT AND INCREASE FUNDS UNDER EXISTING CREDIT FACILITY

The Fresh Factory B.C. Ltd. has completed its previously announced non-brokered private placement resulting in the sale of 26,087 proportionate voting shares in the capital of the company at a price of $115.00 (U.S.) (approximately $160.00) per proportionate voting share for total gross proceeds of approximately $3-million (U.S.) (approximately $4.16-million).

The company intends to use the net proceeds from the offering to finance the growth and development of its business, including upgrades to its existing facilities, and for general corporate and working capital purposes. Closing of the offering remains subject to the final approval of the TSX Venture Exchange.

Each proportionate voting share issued pursuant to the offering has a restricted right to convert into 100 subordinate voting shares in the capital of the company, subject to adjustments for certain customary corporate changes. The ability to convert the proportionate voting shares is subject to a restriction that the aggregate number of subordinate voting shares and proportionate voting shares held of record, directly or indirectly, by residents of the United States may not exceed 40 per cent (subject to increase to 50 per cent in the sole and unfettered discretion of the board of directors of the company) of the aggregate number of subordinate voting shares and proportionate voting shares issued and outstanding after giving effect to such conversions, and to a restriction on beneficial ownership of subordinate voting shares exceeding certain levels, in order for the company to maintain its status as a "foreign private issuer" (as determined in accordance with Rule 3b-4 under the U.S. Exchange Act). The subordinate voting shares are listed and posted for trading on the TSX-V under the symbol "FRSH." The proportionate voting shares are not listed or posted for trading on any stock exchange.

Certain directors of the company purchased an aggregate of 8,258 proportionate voting shares pursuant to the offering. Each subscription by an insider is considered to be a "related party transaction" for the purposes of Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions. The company did not file a material change report more than 21 days before the expected closing date of the offering as the details of the offering and the participation therein by each "related party" of the company were not settled until shortly prior to the closing of the offering, and the company wished to close the offering on an expedited basis for sound business reasons. The company is relying on exemptions from the formal valuation and minority shareholder approval requirements available under MI 61-101. The company is exempt from the formal valuation requirement in Section 5.4 of MI 61-101 in reliance on Section 5.5(a) of MI 61-101 as the fair market value of the transaction, insofar as it involves interested parties, is not more than 25 per cent of the company's market capitalization. Additionally, the company is exempt from minority shareholder approval requirement in Section 5.6 of MI 61-101 in reliance on Section 5.7(1)(a) of MI 61-101 as the fair market value of the transaction, insofar as it involves interested parties, is not more than 25 per cent of the company's market capitalization.

Increase of funds available under existing credit facility

Further to its news release dated Sept. 12, 2025, announcing a three-year revolving asset-based lending facility in the principal amount of $4-million (U.S.) with Mitsubishi HC Capital America Inc., the company is pleased to announce that the lender has increased the amount of funds available under the facility to $5-million (U.S.). No other changes were implemented in connection with the amendment to the facility with the lender.

About The Fresh Factory B.C. Ltd.

The Fresh Factory is a vertically integrated company focused on accelerating the growth of the fresh, clean-label, better-for-you food and beverage brands of tomorrow. The Fresh Factory owns or partners with emerging brands in the better-for-you space to develop, manufacture and sell products made from fresh produce and recognizable ingredients. It operates from its centrally located manufacturing facility near Chicago, serving customers across the United States.

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