Vancouver, British Columbia--(Newsfile Corp. - April 4, 2022) - Vegano Foods Inc. (CSE: VAGN) (OTC PINK: VAGNF) (the "Company") is pleased to announce that it has a definitive agreement (the "Agreement") among the Company, 1355441 BC Ltd., a wholly owned subsidiary of the Company ("Subco") and Smpl Oats Ltd. ("SMPL"), under which the Company will all of the outstanding shares of privately held SMPL (the "SMPL Shares"), in consideration for approximately $3.0 million of Vegano common shares (the "Vegano Shares").

SMPL creates innovative Oat Milk that is dairy-free, gluten free, nut-free and plant based. Operating in the global plant-based beverage market, which is expected to grow to US$22.78 billion by 2027, exhibiting a compounded annual growth rate of 8%^[1], the brand soft launched its premium and nutritious oat milk in late 2021.

During its first full year of operations, Vegano Foods stocked its pristine-digital marketplace with some of the world's best and healthiest brands and products including CHIWIS, LEVEL GROUND, PRANA and MADE GOOD. The acquisition of SMPL Oats is the companies first, and it marks a critical milestone in the development of a vertical distribution model that can scale opportunities on its unique plant-based foods Shopify (TSE: SHOP) marketplace. In the same way that Amazon (NASDAQ: AMZN) used its marketplace to choose which brands to bring in house under its Amazon Basics program, Vegano intends to purchase and make investments into brands consumers are seeking out on its platform.

Additionally, to continue its forward momentum, Vegano Foods will re-focus and maximize the performance of capital through its other in-house branded products such as its Greens Blend and Protein Powder drink mixes - products that work seamlessly with SMPL while driving increase carts size and recurring purchases.

This combination of in-house owned products, efficient supply chain of best-in-class health foods and seamless shopping and delivery experience aims to position Vegano for category dominance and deliver long-term shareholder growth.

Says Vegano CEO Conor Power, "The initial success of SMPL Oats, our aligned mission to help Canadians build healthy eating habits and live a more health-conscious life and strong industry tails winds make this acquisition a perfect fit for shareholders and customers of our burgeoning marketplace."

Plant-based Food & Beverage Market

The Plant Based Foods Association defines plant based as "food and beverages made from plants that contain no animal derived ingredients".^[2]

The North American plant-based beverage market is projected to be valued at US$111.4 million by 2023.^[3] North America is projected to be the fastest-growing region with a compounded annual growth rate of 8.5% from 2021 to 2017 due to a fast-growing vegan population in the region.^[4] Increasing innovation by key regional players is expected to strengthen the North American market. In 2020, the Asia-Pacific market had a share of 34%, owing to the rising per capita income of the middle-class population.^[5] Finally, Europe is also seeing explosive growth in the plant-based beverage sector, as European countries are increasingly adopting more healthy lifestyles.

Plant-based beverages can be divided into the following segments by product type: dairy substitutes, juices, smoothies, ready-to-drink tea & coffee, and other plant derived drinks. Plant-based dairy alternatives are expected to exhibit steady growth and continue to be dominant in market share.

Transaction Terms

The Agreement provides for the acquisition of all the outstanding shares of SMPL by way of a three-cornered amalgamation (the "Amalgamation").

The Amalgamation will be completed under the Business Corporations Act (British Columbia), whereby Subco will amalgamate with SMPL (the "Amalgamation") and the holders of SMPL Shares (the "SMPL Shareholders") will each receive 0.8936 Vegano Shares in exchange for the cancellation of each SMPL Shares. In consideration for all outstanding share capital of SMPL, the Company is expected to issue 28,571,428 common shares, 19,460,512 share purchase warrants to the existing security holders of SMPL. Share purchase warrants are broken down as follows: and 1,468,606 of the share purchase warrants will be exercisable to acquire an additional common share of the Company at a price of $0.112 until February 9, 2024; 5,808,481 of the share purchase warrants will be exercisable to acquire an additional common share of the Company at a price of $0.056 until July 13, 2023; 182,654 of the share purchase warrants will be exercisable to acquire an additional common share of the Company at a price of $0.056 until August 30, 2023; 31,812 of the share purchase warrants will be exercisable to acquire an additional common share of the Company at a price of $0.056 until October 8, 2023; 141,190 of the share purchase warrants will be exercisable to acquire an additional common share of the Company at a price of $0.056 until December 21, 2023; 5,750,000 of the share purchase warrants will be exercisable to acquire an additional common share of the Company at a price of $0.056 until March 25^th, 2024; and 6,721,306 of the share purchase warrants will be exercisable to acquire an additional common share of the Company at a price of $0.0112 for a period of two years from the date of closing of the acquisition.

The corporation continuing from the Amalgamation will be a wholly-owned subsidiary of the Company.

Pursuant to the terms of the Agreement, the closing of the Amalgamation is subject to a number of conditions precedent, including but not limited to: (i) the Amalgamation being approved by a special majority of the SMPL Shareholders; (ii) the receipt of all consents, orders and approvals, including regulatory approvals and orders, necessary or desirable for the completion of the Amalgamation; (iii) completion of due diligence by Vegano; (iv) the exercise of SMPL Special Warrants; (v) compliance with applicable securities laws; (vi) the Amalgamation becoming effective prior to June 30, 2022; and (vii) the satisfaction of other customary closing conditions for transactions of a similar nature to the Amalgamation.

The acquisition of SMPL is not expected to constitute a fundamental change for the Company, nor is it expected to result in a change of control of the Company, within the meaning provided by the policies of the Canadian Securities Exchange. A copy of the Amalgamation Agreement will be filed under the Company's profile at .

Related Party Disclosure

Each of Conor Power and Joel Primus, directors of the Company, are also directors and shareholders of SMPL and accordingly, the acquisition of SMPL securities from each of Messrs. Power and Primus constitutes a related party transaction under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The Amalgamation is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 based on the exemption set out section 5.5(b) Issuer Not Listed on Specified Market and Section 5.7(1)(b) Fair Market Value Not More than $2,500,000. The Agreement was approved by the independent director of the Company. Additional information required pursuant to MI 61-101 will be provided in the material change report to be filed by the Company in connection with the transaction.

Other business

Investor relations

The Company has paid Baystreet.ca Media Corp. $40,000 for landing page design and development and paid media.

Shares for debt

Vegano Foods Inc. also announces that the Company settled C$36,000 owed to a consultant, through the issuance of 300,000 common shares of the Company at a price of C$0.12 per share. A statutory hold period of four-months and one day is in place on the issuance of these shares in accordance with applicable securities laws.

ABOUT VEGANO FOODS INC.

Vegano Foods Inc. is Canada's premier 100% plant-based meal box company that operates in Vancouver and is set to expand to Toronto, Montreal, and Los Angeles later this year. Founded in March of 2020, Vegano helps make healthy plant-based eating more accessible to Canadians, allowing them to take veganism beyond Meatless Mondays and Veganuary. Vegano uses high-quality ingredients sourced from local farmers and producers to ensure that its meal kits are delivered fresh to their members every week. With many chef-created recipes, Vegano's meals can be prepared in under 45 minutes, allowing people to spend less time on meal prep and more time on things they love. For more information, visit .

ON BEHALF OF THE BOARD OF DIRECTORS
Conor Power, CEO & Director
conor@veganofoods.com

Press Contact:
media@veganofoods.com

The CSE has neither approved nor disapproved the contents of this news release. The CSE does not accept responsibility for the adequacy or accuracy of this release.

^[1] Vision Research Reports. (2020, December). Plant-based beverages market size, share, growth, trends, company analysis, regional insights and forecast 2021 - 2027. Vision Research Reports.

^[2] Benzaquen, D. (2021, July 13). Plant Based Foods Association.

^[3] WantStats Research And Media Pvt. Ltd. (2021, February). Plant-based beverages market research, size, share, Global Forecast 2027: MRFR.

Plant-Based Beverages Market Research, Size, Share, Global Forecast 2027 | MRFR.

^[4] Vision Research Reports. (2020, December). Plant-based beverages market size, share, growth, trends, company analysis, regional insights and forecast 2021 - 2027. Vision Research Reports.

^[5] Vision Research Reports. (2020, December). Plant-based beverages market size, share, growth, trends, company analysis, regional insights and forecast 2021 - 2027. Vision Research Reports.

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