Psyched Wellness Announces Closing of Private Placement and Shares for Debt Transaction and Resignation of a Director

Core Viewpoint - Psyched Wellness Ltd. has successfully closed the first tranche of its non-brokered private placement, raising gross proceeds of C$859,653.47, and has also completed a shares for debt transaction with Zerkalo, LLC [1] Private Placement Details - The first tranche of the Offering involved the issuance of 56,930,693 common shares at a price of C$0.0101 per share and 56,930,693 common share purchase warrants at a price of C$0.005 per warrant [2] - Each warrant allows the holder to acquire one additional common share at a price of C$0.0051, valid for 60 months from the closing date [2] Securities and Use of Proceeds - All securities issued are subject to a hold period of four months and one day from the closing date and must comply with U.S. Securities Act requirements [3] - The net proceeds from the Offering will be used for working capital or as permitted under Canadian Securities Exchange policies [3] Related Party Transaction - The Offering is classified as a "related party transaction" as the Investor Group controls over 10% of the outstanding common shares [4] - The Company relied on exemptions from formal valuation and minority shareholder approval due to the transaction's value being below C$2,500,000 and approval from independent directors [4] Shares for Debt Transaction - The Company issued 60,968,317 common shares at C$0.0101 per share to settle US$450,000 (approximately C$615,780) owed to Zerkalo for consultation services [5] - These shares are also subject to a four-month and one-day hold period and U.S. Securities Act requirements [5] Shareholder Structure - Following the transactions, the total number of common shares outstanding is 406,715,844, with the Investor Group's voting interest increasing from approximately 43.1% to 44.6% [6] Investor Rights Agreement - An Investor Rights Agreement was established, allowing the Investor Group to nominate two directors and two independent directors to the Board, which will consist of no more than seven directors [7] - The Investor Group has an 18-month right of first refusal on any proposed financing or capital raising transactions [7] Director Resignation - Trevor Mayer has resigned as a director effective March 20, 2026, and the Company expressed gratitude for his service [8] Company Overview - Psyched Wellness is a Canadian health supplements company focused on distributing mushroom-derived products and aims to establish a leading brand in the functional food category in North America [9]