Mr. Blair Wilson reports

FORBIDDEN SPIRITS ANNOUNCES CLOSING OF FIRST TRANCHE OF PRIVATE PLACEMENT

Forbidden Spirits Distilling Corp. has closed the first tranche of its previously announced non-brokered private placement of convertible notes for aggregate gross proceeds of up to $305,000.

The private placement was completed pursuant to a partial revocation order of the British Columbia Securities Commission dated July 9, 2024, partially revoking the failure-to-file cease trade order (FFCTO) issued against the company.

The convertible notes will be convertible at the option of the holder into common shares in the capital of the company at a price of one cent per share (on a preconsolidation basis). The convertible notes will not be convertible into common shares until the company has received a full revocation of the FFCTO and has also completed a consolidation of its common shares on a one-new-for-10-old basis.

The company intends to use the net proceeds from the private placement to prepare and file outstanding financial statements and continuous disclosure records, pay outstanding related fees and penalties, meet certain financial obligations, and continue operations until it can apply for and receive a full revocation of the FFCTO. When the company has filed all such outstanding financial statements and continuous disclosure records, the company intends to apply for a full revocation of the FFCTO and ask that trading of its common shares on the exchange be reinstated.

In connection with completion of the private placement, the company paid a cash finder's fee of $15,200 (equal to 8 per cent of the proceeds raised) and issued 15,200 finder's warrants to Alpha North Asset Management. Each finder's warrant entitles the holder to acquire one common share for a period of 12 months from the date of grant at a price of one cent per share (on a preconsolidation basis), provided, however, that the finder's warrants cannot be exercised until the company has received a full revocation of the FFCTO and has completed the consolidation.

In accordance with applicable securities legislation, the convertible notes issued pursuant to the private placement (and the common shares issuable on conversion of the convertible notes) will be subject to a hold period of four months and a day from the closing date of the private placement. All of the company's securities, including the securities issued in connection with the private placement, will remain subject to the FFCTO until such order is fully revoked. The granting of the partial revocation order does not guarantee the issuance of a full revocation order in the future.

The completion of the private placement remains subject to the receipt of all requisite approvals, including the final acceptance of the exchange.

About Forbidden Spirits Distilling Corp.

Forbidden Spirits is a fast-growing craft distillery and trades under the ticker symbol VDKA on the TSX Venture Exchange.

Forbidden Spirits currently manufactures and distributes a portfolio of ultrapremium brands, including:

• Rebel vodka;
• Eve's Original gin;
• Adam's Apple brandy;
• Forbidden Fire;
• Forbidden Spirits vodka;
• Wallace Hill whisky.

We seek Safe Harbor.