Mr. Todd Shapiro reports

RED LIGHT HOLLAND APPOINTS KEITH LI AS CHIEF FINANCIAL OFFICER AND PROVIDES CORPORATE UPDATES

Red Light Holland Corp. has appointed Keith Li as its new chief financial officer, effective today.

The company expresses its appreciation to Jon Szczur, who has amicably resigned as interim CFO, allowing for a seamless transition to a permanent leadership role.

About Mr. Li

Mr. Li brings more than 15 years of experience in corporate accounting, finance, equity markets, financial reporting and public company administration. Specializing in management advisory services, regulatory compliance and financial strategy, he has served as CFO for multiple TSX Venture Exchange- and Canadian Securities Exchange-listed companies, including in the junior mining, cannabis, health and wellness, and merchant banking sectors. Mr. Li is a chartered professional accountant (CPA and CA) and holds a bachelor of commerce from McGill University.

"Red Light Holland continues to exhibit vision and aggressive execution," said Todd Shapiro, chief executive officer and director. "Our core focus remains on advancing psilocybin access in emerging markets, including our success in the Netherlands. As an everything mushroom company -- generating revenue, making acquisitions and strategically deploying capital -- strong financial leadership is essential. After interviewing multiple candidates, our team was particularly impressed by Keith's expertise in regulatory compliance, budgeting and operational efficiency."

Keith Li, incoming CFO, added: "Red Light Holland is at the forefront of a transformative industry. With its strong leadership, financial health and mission-driven approach, I am excited to contribute to its continued growth. My focus will be on reporting, revenue expansion, M&A opportunities, and enhancing financial efficiencies to build a world-class brand and distribution network."

Mr. Shapiro emphasized Red Light Holland's continued commitment to its motto: "Mind, body, gain -- grow your health, build your wealth."

"We look forward to what the future holds and are closely monitoring the potential appointment of Robert F. Kennedy Jr. as secretary of the Department of Health and Human Services, which could bring significant positive momentum to our entire sector. Natural plant and fungi medicines are becoming increasingly accepted, and we are excited to lead in this space," added Mr. Shapiro.

Corporate updates

Red Light Holland is pleased to provide key updates on its continuing growth initiatives and coming projects:

• Partnership with Irvine Labs: Red Light Holland expects to release imminent updates regarding its collaboration with Irvine Labs in California. Irvine Labs' Food and Drug Administration-compliant and Drug Enforcement Administration-registered facility enables psilocybin production and psilocybin exports and imports to and from legal jurisdictions worldwide. The company believes this is a significant partner for research and development and potential future commercialization of psilocybin to emerging markets.
• Happy Caps mushroom home grow kits expansion with Costco Canada: The company is preparing to fulfill Costco Canada's planned 20,000-plus unit order for April, 2025, in collaboration with Holburne Mushroom Farm in Canada.
• Happy Caps mushroom home grow kits U.S. retail growth: The company has received a formal commitment to expand Happy Caps home grow kits into a major U.S. retailer in spring 2025. Preparation work is already under way with Trailbridge Farms in Oregon, with more details to be announced soon.
• Happy Caps functional gummies launch: The company is on track for the beta launch of its functional lion's mane and shiitake gummies in April, 2025, with more details to be announced soon.
• Merger-and-acquisition activity: The company is actively engaged in four NDA-protected discussions with potential acquisition targets. A non-binding offer will be presented to one of these companies in the coming days.
• Mr. Shapiro and senior adviser Tony Clement's high-level government meeting: Mr. Shapiro and senior adviser Mr. Clement have secured a meeting with a senior politician on Wednesday, Jan. 22, 2025. The company looks forward to updating shareholders on the outcome of this meeting, which could have important implications for the company's FarmCare Health initiative.
• Banking challenges and financial strategy: After 4.5 years of maintaining its banking operations with a Tier 1 Canadian bank, the company was recently informed of it being debanked. The company is actively exploring new banking relationships with other Tier 1 institutions. In the interim, the finance team has implemented alternative on-line banking solutions, ensuring zero impact on daily operations. The company's banking operations remains strong in the Netherlands.
• AEM Peterborough farm build update: The company is still exploring lending options for its farm expansion, but Tier 1 banks have denied loans due to reputational risk and not commercial viability. Despite approved budgets and forecasts, compliance concerns over psilocybin's legal status in the Netherlands have made traditional financing difficult, especially given Tier 1 banks' recent fines and scrutiny in the Canadian banking sector.
• Shiitake mushroom sales update: Sales at AEM New Brunswick have experienced fluctuations due to inflation and decrease in consumer spending habits, but are currently trending up again. The company remains committed to optimizing production and distribution to ensure continued growth in this segment.
• Leading legal psilocybin sales: As a publicly traded company, Red Light Holland believes it has sold the highest volume of legal psilocybin globally in 2024 for adult, responsible, educational and informational use. In the 2024 calendar year, the company sold approximately 1.35 million grams of magic truffles through SR Wholesale. Despite anecdotal reports from employees in the Netherlands suggesting retail shops sales have slowed due to a decline in tourism and local consumer spending, the company remains confident in projecting higher sales of magic truffles for the longer-term outlook.
• Cash management and alternative investments: On top of its day-to-day cash flow, the company maintains a majority of its cash safely invested in a guaranteed investment certificates. The company is actively exploring alternative investment opportunities, including strategic private investments or potentially in cryptocurrency (bitcoin). In the interim, the company continues to focus on prudent cash management, always aiming to reduce the company's cash burn, reinforcing its focus on financial stability and long-term profitability.
• Operational efficiency: As reported on Nov. 29, 2024, nearly all of the company's portfolio-generating companies over the past four quarters have been operating in the black, with positive operating cash flow -- excluding depreciation, corporate costs and other non-operational expenses, demonstrating its effective management and execution. Unfortunately, third quarter 2025 had minor challenges due to tightening consumer spending habits. The company continues to focus on innovation and growth, and is excited for the commitments of major retailers to expand the Happy Caps brand in both Canada and the United States. The company is also pleased about the uptrend in shiitake mushroom sales out of AEM New Brunswick.
• Veteran support and psilocybin access: The company is actively exploring a partnership to collaborate with respected veterans to help facilitate legal access to psilocybin for PTSD treatment. Red Light Holland strongly believes in the therapeutic potential of psilocybin and is committed to working with veterans organizations and advocacy groups to advance responsible access and research efforts.
• Mr. Shapiro's shareholder engagement: Mr. Shapiro looks forward to hosting more live spaces on X (Twitter) and encourages shareholders to join in discussions about the company, the broader psychedelics sector and their view on the future of psilocybin.

Grants of stock options and restricted stock units

The company also announces the grant of:

• 9.2 million common shares of the company to certain directors, officers, employees and consultants of the company; the stock options are exercisable at a price of five cent per share until Jan. 21, 2030. Upon issuance:
  • Stock options for 3,066,662 shares vested immediately.
  • Stock options for 3,066,662 shares will vest on Jan. 21, 2026.
  • Stock options for 3,066,676 shares will vest on Jan. 21, 2027.
• 5.75 million restricted stock units to certain directors, officers, employees and consultants of the company. Upon issuance:
  • A total of 1,916,665 RSUs vested immediately.
  • A total of 1,916,665 RSUs will vest on Jan. 21, 2026.
  • A total of 1,916,670 RSUs will vest on Jan. 21, 2027.

All stock options and RSUs were granted in accordance with the company's equity incentive plan approved at the company's annual general and special meeting held on Oct. 31, 2024.

The common shares underlying the stock options and RSUs set out above are subject to a statutory four-month-and-one-day hold period expiring on May 22, 2025, and such further restrictions as may apply under foreign securities laws.

Certain directors of the company received five million stock options and four million RSUs representing a related-party transaction under Multilateral Instrument 61-101 (Protection of Minority Security Holders in Special Transactions); however, the transaction is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 as neither the fair market value of the subject matter of the transaction, nor the consideration exceeds 25 per cent of the company's market capitalization.

Issuance of shares-for-debt settlement

The company also announces that its board of directors has approved the issuance of one million common shares in the capital of the company to an arm's-length party at the deemed price of five cents per share.

Furthermore, the company's board of directors has approved the settlement of amounts owing to arm's-length creditors through the issuance of common shares in the capital of the company at the deemed price per share to be determined at time of settlement.

About Red Light Holland Corp.

Red Light Holland is an Ontario-based corporation engaged in the production, growth and sale of functional mushrooms and mushroom home grow kits in North America and Europe, and a premium brand of psilocybin truffles to the legal, recreational market within the Netherlands, in compliance with all applicable laws.

We seek Safe Harbor.