Wilmot L. Matthews Announces Resignation as Director of SQI Diagnostics Inc., Debt Forgiveness, Voting Trust Agreement and Related Transactions

NOT FOR DISSEMINATION IN THE UNITED STATES OR OVER UNITED STATES NEWSWIRE SERVICES

TORONTO, Nov. 30, 2023 (GLOBE NEWSWIRE) -- Mr. Wilmot L. Matthews ("Mr. Matthews") announces that he has resigned as director of SQI Diagnostics (the "Company") effective October 29, 2023 (the "Effective Date"). Mr. Matthews also announces that he has forgiven $2,450,000 aggregate principal amount, plus accrued and unpaid interest, of secured debentures of the Company held by Mr. Matthews.

In connection with his resignation from the board of directors of the Company, Mr. Matthews entered into a voting trust agreement (the "Voting Trust Agreement") with Mr. David Markowski, a new director of the Company, pursuant to which Mr. Markowski was appointed Mr. Matthews' voting trustee and acquired the exclusive voting rights over all of the 104,435,807 common shares ("Shares") in the capital of the Company beneficially owned, directly or indirectly, by Mr. Matthews with respect only to any and all elections of directors of the Company. The Voting Trust Agreement has a term of three years, subject to early termination in the event that the Company does not hold any technology, intellectual property or other commercial licences (collectively, the "Technology IP") from the University Health Network or transferred to it by Pivot Financial I Limited Partnership ("Pivot"). At the time of Mr. Matthews' resignation, the Company did not hold any license to the Technology IP however Mr. Matthews has been informed that the Company's new board of directors intends to seek such licenses in connection with a proposed restructuring (the "Restructuring") of the Company to be overseen by the new board. Mr. Matthews has no involvement in the Restructuring and there can be no assurance that it will be completed.

Mr. Matthews has also entered into a share transfer agreement (the "Share Transfer Agreement") with Pivot as of the Effective Date, pursuant to which he has agreed to transfer 8,333,333 Shares beneficially owned, directly or indirectly, by Mr. Matthews to Pivot for nominal consideration in connection with the proposed Restructuring and only in the event that the TSX Venture Exchange does not grant approval for the Company to issue Pivot 8,333,333 Shares from treasury (the "Pivot Share Issuance"). The obligations of Mr. Matthews under the Share Transfer Agreement are conditional on the revocation of, or applicable amendment to, the cease trade order (the "CTO") affecting the securities of the Company dated September 5, 2023 and other applicable regulatory approvals.

Also on the Effective Date, Mr. Matthews and the Company entered into a warrant exercise agreement (the "Warrant Agreement") pursuant to which Mr. Matthews agreed to sell, from time to time, Shares beneficially owned, directly or indirectly, by Mr. Matthews as of the Effective Date at or around the prevailing market price of the Shares at the time of any such sales and to use the proceeds of sales (net of commissions, taxes and other selling costs) to finance the exercise of common share purchase warrants ("Warrants") of the Company held by Mr. Matthews in order to fund the Company. The completion of any Share sales and related Warrant exercises under the Warrant Agreement is conditional upon the CTO being revoked or amended in such a manner that would allow for the sale of Shares under applicable securities laws. In connection with the entering into the Warrant Agreement, Mr. Matthews agreed to forfeit and surrender 7,017,543 Warrants (the "2026 Warrants") expiring November 1, 2026 and 5,555,556 Warrants (the "2027 Warrants") for nil consideration as of the Effective Date. There can be no assurances as to the timing of the transactions contemplated by the Share Transfer Agreement or Warrant Agreement nor whether any such transactions will be completed.

Immediately prior to the Effective Date, Mr. Matthews beneficially owned or exercised control or direction over 104,435,807 Shares and 47,230,672 Warrants, representing approximately 25.71% of the issued and outstanding Shares on a non-diluted basis and representing approximately 33.45% of the issued and outstanding Shares assuming the full exercise of all Warrants that Mr. Matthews beneficially owns or exercises control or direction over. As a result of the surrender and cancellation of the 2026 Warrants and 2027 Warrants, Mr. Matthews owns or exercises control or direction over 97,570,247 Shares and 34,657,572 Warrants, representing approximately 25.71% of the issued and outstanding Shares on a non-diluted basis and representing approximately 31.55% of the issued and outstanding Shares assuming the full exercise of all Warrants that Mr. Matthews beneficially owns or exercises control or direction over.

In addition to the transactions described herein, Mr. Matthews may increase or decrease his investment, directly or indirectly, in securities of the Company from time to time, depending on market conditions or any other relevant factors.

A copy of the report relating to the Voting Trust Agreement, Share Transfer Agreement and Warrant Agreement may be found on SQI's profile at www.SEDAR.com or may be obtained from Mr. Matthews at 416-214-2226 or at Mr. Matthews' address: 200 King Street West, Suite 1702, Toronto, Ontario M5H 3T4. SQI's head office is located at 36 Meteor Drive, Toronto, Ontario M9W 1A4.