Happy Belly Food Group Closes Earn-Out Agreement of Via Cibo Restaurant Chain

Rhea-AI Summary

Happy Belly Food Group (OTCQB: HBFGF) has announced the closing of the earn-out agreement for its Via Cibo Restaurant Chain acquisition. The company reported significant growth since the acquisition in early 2024, including a new location in Barrhaven, Ottawa, a signed franchisee in Niagara Falls, and a 15-Unit Area Development Agreement in Ontario.

The earn-out details reveal Via Cibo exceeded forecasted EBITDA by $85,805 above the estimated $75,000. The sellers will receive 399,093 common shares at a 10-day VWAP of $1.29, totaling $514,830. Happy Belly currently has 626 contractually committed retail franchise locations across all its emerging brands portfolio.

Positive

• None.

Negative

• Transaction constitutes a related party transaction due to involvement of company directors
• Dilution of existing shareholders through issuance of 399,093 new common shares

Toronto, Ontario--(Newsfile Corp. - September 30, 2025) - Happy Belly Food Group Inc. (CSE: HBFG) (OTCQB: HBFGF) ("Happy Belly" or the "Company"), a leader in acquiring and scaling emerging food brands is pleased to announce the closing of the earn-out agreement regarding the acquisition of the Via Cibo Restaurant Chain ("Via Cibo"). Via Cibo delivers fast-casual Italian street food crafted with the finest traditional ingredients, offering a chef-driven culinary experience for anyone seeking fresh, authentic flavor.

Happy Belly 1

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"Since the accretive acquisition of Via Cibo in early 2024, the brand has accelerated within our franchising framework. Via Cibo, like all brands that join the Happy Belly family has integrated with our favourable supplier contracts, rebate system integration, ordering and logistical systems, leveraged shared resources encompassing culinary, accounting and marketing staff for increased labour and productivity efficiencies, and much more," said Sean Black, Chief Executive Officer of Happy Belly. The integration has yielded a realized increased EBITDA for the brand while maintaining a customer first approach to serving a great product with great value. We have grown the Via Cibo footprint with a newly opened location in the Barrhaven region in the city of Ottawa. We have signed our second new franchisee since acquisition for the Niagara Falls region of Ontario, and we have added a 15-Unit Area Development Agreement in Ontario to our growth plan. It's been a very good year for the Via Cibo brand, and for Happy Belly."

Happy Belly 2

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"Our asset-light franchise model enables Happy Belly to continue accelerating growth across all our brands. With a strong foundation, strategic leadership, and a dedicated franchise support system, we are well-positioned to drive sustained success in the Canadian QSR market. This is another step forward in our mission to become a predictable and disciplined growth company, Canada's leading restaurant consolidator."

"We look forward to continuing to execute on our franchising model as we accelerate our growth organically and inorganically through accretive M&A. Our team is committed to sourcing and evaluating premium real estate, reviewing franchisee applications, and collaborating closely with area developers to support growth. We currently have 626 contractually committed retail franchise locations from area developers across all emerging brands in the Happy Belly Food Group portfolio including those in development, under construction or already open. We are working to actively expand this pipeline with our disciplined approach to growth."

"We are just getting started," said Sean Black.

Earn-Out Details
The Via Cibo business entity recognized, on a normalized EBITDA basis for the 2024 earn-out year, an increase of $85,805 above the estimated $75,000 of forecasted EBITDA. As per the terms of the agreement the increase in normalized EBITDA is to be paid out at a 6x multiple. This yields a $514,830 amount owed to the sellers whom have elected to received the payment in shares of Happy Belly at a record 10-day VWAP of $1.29 leading up to the signing and finalization of the agreement. We anticipate this transaction to close in five business days at which time Happy Belly will issue 399,093 common shares to satisfy the close of the agreement.

Some of the Via Cibo Principals, being Mr. Alex Rechichi and Mr. Sean Black, are directors of the Company, and therefore the Transaction constitutes a "related party transaction under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The Company is relying on exemptions from the formal valuation and minority approval requirements of MI 61-101 based on a determination that the securities of the Company are listed on the Canadian Securities and that neither the fair market value of the subject matter of, nor the fair market value of the consideration for, the Transaction, in so far as it involves interested parties, exceeds 25% of the market capitalization of the Company.

Pursuant to MI 61-101, the Company will file a material change report providing disclosure in relation to each "related party transaction" on SEDAR+ under the Company's issuer profile at www.sedarplus.ca. The Company did not file the material change report more than 21 days before the expected closing date of the Transaction as the details of the Transaction and the participation therein by each "related party" of the Company were not settled until shortly prior to the closing of the Transaction, and the Company wished to close the Transaction on an expedited basis for sound business reasons.

About Via Cibo
Via Cibo, an all-franchised system, is an asset-light entity with established street-front real estate locations in both Ontario and Alberta. Authentic Italian Street food, made with the best traditional ingredients for those looking for fast, fresh food that respects tradition via a chef driven full-service restaurant without the full service. At Via Cibo you can enjoy an authentic Italian meal that does not require hours of your time or a great amount of money. Via Cibo is a fast casual restaurant which offers an experience tailored to your needs. Order from one of our greeters and our servers deliver your fresh authentic dishes to your table in under 10min. Via Cibo is the Italian food Italians talk about. Our kitchen is open, smell the food, watch the cooks, have a bite with friends and share in our love for food!

Franchising
For franchising inquiries please see www.happybellyfg.com/franchise-with-us/ or contact us at hello@happybellyfg.com.

About Happy Belly Food Group
Happy Belly Food Group Inc. (CSE: HBFG) (OTCQB: HBFGF) ("Happy Belly" or the "Company") is a leader in acquiring and scaling emerging food brands across Canada.

Happy Belly 3

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Sean Black
Co-founder, Chief Executive Officer

Shawn Moniz
Co-founder, Chief Operating Officer

FOR FURTHER INFORMATION, PLEASE VISIT:
www: www.happybellyfg.com or email hello@happybellyfg.com
If you wish to contact us please call: 1-877-589-8805

Neither the Canadian Securities Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of this press release, which has been prepared by management.

Cautionary Note Regarding Forward-Looking Statements

All statements in this press release, other than statements of historical fact, are "forward-looking information" with respect to the Company within the meaning of applicable securities laws. Forward-Looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur and include the future performance of Happy Belly and her subsidiaries. Forward-Looking statements are based on the opinions and estimates at the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking statements. There are uncertainties inherent in forward-looking information, including factors beyond the Company's control. There are no assurances that the business plans for Happy Belly described in this news release will come into effect on the terms or time frame described herein. The Company undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change except as required by law. The reader is cautioned not to place undue reliance on forward-looking statements. For a description of the risks and uncertainties facing the Company and its business and affairs, readers should refer to the Company's Management's Discussion and Analysis and other disclosure filings with Canadian securities regulators, which are posted on www.sedarplus.ca.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/268509

FAQ

What is the value of Happy Belly's Via Cibo earn-out agreement in 2025?

The earn-out agreement is valued at $514,830, to be paid in 399,093 common shares at a VWAP of $1.29 per share, based on Via Cibo exceeding its EBITDA forecast by $85,805.

How many franchise locations does Happy Belly Food Group (HBFGF) have committed?

Happy Belly Food Group has 626 contractually committed retail franchise locations across all its emerging brands portfolio, including those in development, under construction, or already open.

What expansion plans were announced for Via Cibo under Happy Belly?

Via Cibo has expanded with a new location in Barrhaven (Ottawa), signed a franchisee for Niagara Falls, and secured a 15-Unit Area Development Agreement in Ontario.

How has Via Cibo performed since being acquired by Happy Belly Food Group?

Via Cibo has shown strong performance, exceeding its EBITDA forecast by $85,805, successfully integrating with Happy Belly's supplier contracts, and expanding its footprint with new locations and development agreements.

What are the related party transaction details in Happy Belly's Via Cibo earn-out?

The transaction involves company directors Mr. Alex Rechichi and Mr. Sean Black as Via Cibo Principals, qualifying as a related party transaction under MI 61-101, with exemptions from formal valuation and minority approval requirements.