Top Gum Industries Ltd.

Regulatory Filings • Jan 26, 2025

The information included under this presentation (the "Presentation") is for informational purposes only and does not constitute or form any part of any offer to purchase securities and/or an invitation to make offers for their purchase or solicitation of any of the above regarding any securities of Top Gum Industries Ltd. (the "Company") and should not be regarded as a recommendation or an opinion. Any such offer or sale will be made on the basis of a prospectus published by the Company after receiving a permit from the Securities Authority and approval from the Tel Aviv Stock Exchange (hereinafter, respectively: "Securities Authority" and "the Stock Exchange").

This presentation does not purport to encompass or contain any information that may be relevant for the purpose of making any decision regarding an investment in the Company's securities and generally. This presentation does not replace independent data collection and analysis, it should be bear in mind that past data does not necessarily indicate future performance. The presentation includes data and statistics and other publications published by third parties, the content of which has not been independently verified by the Company. The presentation was made, for a convenient and concise presentation, and it does not exhaust the full data about the company and its activities and does

not replace the need to perform a full due diligence. The information contained in this presentation is incomplete and all that is stated in it is subject to a full due diligence and is not a substitute for reviewing reports published by the Company to the public and especially in the draft prospectus or final company prospectus, supplementary prospectus and shelf prospectus. The information under this Presentation is not a substitute for public Information and in the event of any conflict between the content of this presentation and the content of any public Information, the content of the Public Information shall prevail. The information in this Presentation should not be relied upon as any representation or warranty, express or implied, of the Company. No reliance should be made on the fairness, accuracy, completeness or correctness of the information or opinions contained herein. No legally binding obligations may be created, implied, or inferred from this Presentation. Various statements in this presentation include information which derives from forecasts, estimates, assessments, and other information pertaining to future events and/or matters, the materialization of which is uncertain and beyond the Company's control, and which constitute "forwardlooking information", as defined under the Israeli Securities Law, 1968. Forward-looking statements include descriptions regarding the intent,

belief, or current expectations of the Company and are not guaranteeing future results, performance, or achievements and are based on current expectations, estimations, and assumptions, involve certain risks and uncertainties which are difficult to predict and are not guarantees of future performance. Therefore, actual future results, performances, or achievements of the Company may differ materially from what is or may be expressed or implied in this presentation due to a variety of factors, many of which are beyond the Company's control, including, without limitation, certain risk factors. The Company does not undertake any obligation to update or revise any of the forward-looking statements, whether as a result of new information, future events, or otherwise. Certain information and factual statements (including relating to markets or trends) contained herein are based on or derived from publicly available documents or independent third-party sources, and therefore the accuracy of such information and the assumptions on which such information is based has not been independently verified. Nothing in this presentation constitutes tax or business advice and does not constitute a substitute consulting appropriate advisors in these aspects. Every potential investor should seek advice and guidance in connection with potential investments, including tax advice is given such investor tax status.

DEAL RATIONALE

Proximity to Our Main Markets

Over 2/3 of TopGum's supplement revenue is generated in the US

Technological Diversification

Expanding into new technologies and products

Expand Our Customer Base

Accelerating revenue growth by tapping into new Tier-1 customers and product segments

Geographical Diversification

Diversifying our production footprint

Bottling

Exploit the full potential of in-house bottling capabilities

Target

ISLAND ABBEY NUTRITIONALS™

An industry leading CDMO of gummy and lozenge nutraceuticals

• · Established 2004 in Charlottetown, Prince Edward Island, Canada
• State-of-the-art facility spanning 6,000 sqm with advanced production and bottling technologies
• A robust customer base of Tier-1 brands
• Developer and manufacturer of gummy and lozenge nutraceuticals through B2B co-man and independent B2C brand
• ~95 experienced FTEs

State-of-the-Art Manufacturing Facility

Two starchless gummy production lines and an additional lozenge production line supporting Island Abbey's growth prospects

Gummy Production

• Advanced large volume Tanis line and a smaller capacity Yinrich line
• · Starchless production technology
• High mineral-load capabilities
• · Adapted for center-fill technology

Lozenge Production

• Honey-based lozenges expertise
• 4 blistering and packaging lines

A STRATEGIC DEAL TAKING TOPGUM TO THE NEXT LEVEL

Delivering on TopGum's Accelerated Growth Strategy

Doubling down on performance across tinancials, customers, product and operations

Accelerated Financial Performance

Annual revenue run-rate in excess of USD 100M, with adjusted EBITDA margin of ~16%

Production Expertise

State-of-the-art facility, with advanced technologies and bottling capabilities

Expanded Tier-1 Customer Base

Adding new strategic Tier-1 brands to our customer base Expanded Global Footprint

Increased operational efficiency through supply chain optimization and proximity to TopGum's main customers

Significant Cross-Selling Opps

Offering TopGum's products to Island Abbey's customers and vice-versa

Potential Synergies and Opportunities

From sales through technology to operations

Deal Structuring and Financing

• Transaction Framework
• · Asset deal
• ・ Cash free-debt free (no debt)
• Net working capital USD 6.5M
• Tangible assets value USD 18.8M
• USD 20M payable as follows:
• Guaranteed Payment
• USD 15M payable in cash at closing
• · USD 5M payable in cash on the first anniversary of the closing

Earn Out

• · One earn-out payment paid on March 2026, based on the increase in Island Abbey's Gross Profit in 2025
• Based on current forecast for 2025, the payment is estimated at USD 21M

Deal Structuring and Financing

• From company's own resources and available unutilized bank credit lines
• Financing • The company obtained comfort letters from leading Israeli banks for the entire consideration

• In the event Tariffs will be imposed by the US government on Island Abbey's US-bound products by March 31st, TopGum has the right to withdraw from the transaction (up to February 5th - without compensation, and thereafter – USD 1M break-up fee)
• In calculating the earn-out payment, revenue will be adjusted to calculate tariff impact

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Thank you

Island Abbey's Independent B2C Brand

• · A leading honey-based gummy vitamin, supplement and lozenge brand in Canada
• Lozenges contain 95%+ honey compared to other brands using sugar and artificial sweeteners as their leading ingredient