Happy Belly to acquire full ownership of Heal Wellness

Executive Summary

• Happy Belly Food Group Inc. entered into a definitive share purchase agreement (effective Oct. 9, 2025) to acquire the remaining 50 % ownership interest in Heal Lifestyle Inc. (“Heal Wellness”), bringing its total stake to 100 %.
• The acquisition price totals $3,896,948, payable via transfer of 2,777,777 existing Happy Belly shares and issuance of an additional 613,469 treasury‑held Happy Belly shares (subject to resale restrictions).
• Upon closing, both JVCo and the Heal operating entity will become wholly owned subsidiaries of Happy Belly; the deal is expected to close on Oct. 9, 2025 and does not trigger a change of control or fundamental change for Happy Belly.

Key Details

• Background: Happy Belly previously acquired a controlling interest in Heal Wellness (May 5‑9, 2022) through a share exchange with vendors and JVCo, receiving 200 JVCo shares in exchange for 2,777,777 Happy Belly common shares valued at $0.09 each ($250,000).
• Call Option Exercise: On May 6, 2025 Happy Belly delivered notice to exercise its call option on the remaining 50 % of JVCo held by the vendors.
• Purchase Price & Consideration:
• Aggregate purchase price: $3,896,948 (subject to adjustments).
• Payment method:
  • Transfer of 2,777,777 Happy Belly shares already issued and held by JVCo to the vendors.
  • Issuance of 613,469 additional Happy Belly treasury shares to the vendors (restricted from resale until four months and one day after closing).
• Closing: Expected on Oct. 9, 2025; SPA currently held in escrow.
• Ownership Outcome: Post‑closing, JVCo and Heal Wellness will be 100 % owned subsidiaries of Happy Belly Food Group.
• Regulatory Impact: The transaction does not constitute a “fundamental change” or trigger a change‑of‑control under Canadian securities law or CSE policies. No finder's fee is payable.
• Strategic Rationale (CEO Quote): Sean Black highlighted Heal Wellness’s growth from 2 to 27 operating stores, a pipeline of 168 additional locations across Canada, and entry into the U.S. market via a 10‑unit development agreement in Dallas‑Fort Worth, underscoring the brand’s role as a cornerstone of Happy Belly’s portfolio and its asset‑light franchise model.

Notable Quotes

“The brand has grown from its initial two locations to 27 operating stores nationwide, while developing a robust pipeline of 168 additional locations under signed agreements… This trajectory reflects not only consumer demand for wellness‑forward dining but also our disciplined approach to growth that creates lasting value for our shareholders.” – Sean Black, CEO, Happy Belly Food Group Inc.