OSPRAIE AG SCIENCE, LLC - EARLY WARNING PRESS RELEASE REGARDING ACQUISITION OF SECURITIES OF CO2 GRO INC.

NEW YORK, Feb. 2, 2024 /CNW/ - This press release is being disseminated by Ospraie Ag Science, LLC ("Ospraie"), as required by National Instrument 62-103 – The Early Warning System and Related Take Over Bids and Insider Reporting Issues in relation to their beneficial ownership of common of securities of CO2 GRO Inc. (TSXV: GROW) (the "Issuer").

On February 2, 2024, Ospraie entered into a subscription agreement (the "Subscription Agreement") with the Issuer, pursuant to which the Issuer has agreed to issue to Ospraie unsecured convertible debentures (the "Debentures") of up to C$200,000 and 11,111 common share purchase warrants (each, a "Warrant") for every C$1,000 of the principal amount of the Debentures subscribed for, each convertible into common shares (each, a "Common Share") in the capital of the Issuer.

At the option of Ospraie, the Debentures are convertible into Common Shares at any time after their issuance. The Debentures shall be issued in three tranches (February 2, February 29 and March 29), each of which would be due on February 2, 2027. Interest will accrue on the Debentures at 13.5% per annum from the applicable date of issuance.

The Debentures are subject to a forced conversion provision whereby, upon delivery of notice to holders of the Debentures, the Issuer is permitted to convert the principal amount of all outstanding Debentures into Common Shares in the event that the average closing price of the Common Shares listed on the TSX Venture Exchange (the "TSXV") is  C$0.20 or higher for twenty (20) consecutive trading days.

At any time (i) upon a Change of Control (as defined in the Subscription Agreement) of the Issuer or (ii) after February 2, 2025, the Issuer shall have the option to redeem all outstanding Debentures in whole on the date that is thirty (30) days following the giving of such notice of redemption, at a price equal to 100% of the principal amount of the Debentures then outstanding plus accrued and unpaid interest thereon up to and including the date of redemption.

Each Warrant entitles Ospraie to acquire one Common Share at an exercise price equal to the greater of (i) C$0.105 and (ii) such other amount that is required under TSXV policies, until February 2, 2028.

The Debentures and the Warrants contain customary adjustment provisions. Any Common Shares to be issued to Ospraie in connection with any conversion of the Debentures or exercise of the Warrants would be acquired from treasury.

Immediately before giving effect to the transaction, Ospraie had ownership of 20,000,000 Common Shares, representing approximately 20.5% of the issued and outstanding Common Shares.

After giving effect to the acquisition of the first tranche of Debentures (C$100,000), which tranche closed on February 2, 2024, Ospraie had beneficial ownership of 20,000,000 Common Shares, C$100,000 of Debentures (convertible into 1,111,111 Common Shares) and 1,111,100 Warrants, representing approximately 22.3% of the issued and outstanding Common Shares on a partially diluted basis (assuming conversion of the first tranche Debentures at a price equal to C$0.09 per Common Share and exercise of the first tranche Warrants).

The remaining Debentures and Warrants will be issued in two tranches expected to close on or about February 29 and March 29, 2024 in equal installments of C$50,000. The conversion price of the Common Shares will be equal to the greater of (i) C$0.09 and (ii) such other amount that is required under TSXV policies at the closing date of each subsequent tranche.

Assuming that Debentures are issued in the second tranche in the amount of C$50,000 at a conversion price of C$0.09 per Common Share, after giving effect to the second tranche, Ospraie will have beneficial ownership of 20,000,000 Common Shares, C$150,000 of Debentures (convertible into 1,666,666 Common Shares)  and 1,666,650 Warrants, representing approximately 23.2% of the issued and outstanding Common Shares on a partially diluted basis (assuming conversion of the first and second tranche Debentures and exercise of the first and second tranche Warrants). Assuming that Debentures are issued in the third tranche in the amount of C$50,000 at a conversion price of C$0.09 per Common Share, after giving effect to the third tranche, Ospraie will have beneficial ownership of 20,000,000 Common Shares, C$200,000 of Debentures (convertible into 2,222,221 Common Shares) and 2,222,200 Warrants, representing approximately 24% of the issued and outstanding Common Shares on a partially diluted basis (assuming conversion of the first, second and third tranche Debentures and exercise of the first, second and third tranche Warrants).

The Debentures and the Warrants were acquired for investment purposes. Ospraie reviews its holdings in the Issuer from time to time and may, depending on such review, market and other conditions and subject to compliance with applicable hold periods, increase or decrease its ownership of Common Shares, other securities of the Issuer or related financial instruments, whether in the open market, by privately negotiated transaction or otherwise.

A copy of the early warning report to be filed by Ospraie in connection with the transaction described above will be available on SEDARplus.ca under the Issuer's profile. This news release is issued under the early warning provisions of the Canadian securities legislation.

FOR FURTHER INFORMATION, OR TO OBTAIN A COPY OF THE EARLY WARNING REPORT FILED BY OSPRAIE UNDER APPLICABLE SECURITIES LEGISLATION, PLEASE SEE THE CONTACT INFORMATION BELOW:

Ospraie Ag Science, LLC
c/o Ospraie Management, LLC
411 Theodore Fremd Ave, Suite 240
Rye, NY 10580
Attn:  Scott Baglio

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

SOURCE Ospraie Ag Science, LLC