PRINCIPAL TECHNOLOGIES ANNOUNCES LOAN FINANCING AND PRIVATE PLACEMENT AND PROVIDES UPDATE ON VIVOSTAT A/S ACQUISITION

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VANCOUVER, BC, April 3, 2024 /CNW/ - Principal Technologies Inc. (the "Company") (TSXV: PTEC) (FSE: J07), is pleased to announce that on March 8, 2024, it entered into a binding commitment letter with the effect that the GreenIslands Opportunities Fund (the "Lender") will provide a secured loan in the principal amount of ?8,000,000 (the "Loan") to provide acquisition financing with respect to the cash portion of the purchase price for Vivostat A/S ("Vivostat"), as further outlined in its news release dated February 6, 2024, and for general working capital purposes.

The terms of the Loan include:

• the secured loan shall be provided to the Company by the Lender on a lump sum basis;
• interest rate of 12.00% per annum on the principal amount outstanding, payable up to and including the date which is six (6) years after the initial advance under the Loan (the "Loan Maturity Date");
• interest will be payable quarterly and principal amount payable in twenty (20) quarterly installments;
• principal amount and interest in the first year shall not be paid until the Loan Maturity Date;
• the loan will be secured by, among other things, a pledge of all the shares acquired in Vivostat; and
• payment shall be permitted in full or in part with a 6% prepayment penalty on the prepaid amount.

The Loan provides full financing for the Company to close the Vivosat acquisition, and after final adjustments any remaining funds will be utilized by the Company for working capital purposes.

"This loan, by our major shareholder, effectively underwrites our previously-announced acquisition of Vivostat" commented Jerry Trent, Chief Executive Officer of Principal Technologies Inc. "Vivostat is the world's leading autologous sealant solution, developed by Bristol Myers Squibb at a cost of US$100 million. We are now on track to bring this solution to the thousands of hospitals and clinics in jurisdictions in which it has never been sold, including Japan, Brazil and Australia."

Vivostat is a profitable company generating ?3.8 million in revenue in 2023.

In addition, the Company is pleased to announce a non-brokered financing of up to 4,000,000 units at $0.25 (the "Offering Price") for gross proceeds of up to $1,000,000 (the "Private Placement). Each unit (a "Unit") will consist of one common share (a 'Share") of the Company and one common share purchase warrant (a "Warrant"). Each Warrant entitles the holder to purchase one additional Share of the Company at $0.30 for a period of two (2) years from the date of closing. Proceeds of the Private Placement will be used for general working capital and corporate purposes.

In connection with the Private Placement, pursuant to the policies of the TSX Venture Exchange (the "Exchange"), the deemed price of the 2.5 million common shares issuable by the Company as partial consideration for the acquisition of Vivostat shall be revised to the Offering Price.

The Private Placement is subject to approval of the Exchange and all securities of the Company issued pursuant to the Private Placement will be subject to a four month hold period from the date of issuance. The Private Placement will not result in the creation of a new control person of the Company.

The securities offered have not been registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws and may not be offered or sold absent registration or compliance with an applicable exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws.

The Lender holds 38.03% of the Company's issued and outstanding shares and as such the Loan constitutes a related party transaction as defined under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The Loan is exempt from the formal valuation requirements pursuant to Subsection 5.5(b) of MI 61-101 (Issuer Not Listed on Specified Markets) and is exempt from the minority shareholder approval requirements pursuant to Subsection 5.7(f) of MI 61-101 (Loan to Issuer, No Equity or Voting Component). The material change report in relation to the related party transactions will be filed less than 21 days before the completion of the proposed Loan as the Company wishes to complete the corresponding acquisition of Vivostat as soon as commercially feasible.

ON BEHALF OF THE BOARD

Jerry Trent, Chief Executive Officer
Principal Technologies Inc.

This press release contains "forward-looking information" and "forward-looking statements" within the meaning of applicable securities laws. This information and statements address future activities, events, plans, developments and projections. All statements, other than statements of historical fact, constitute forward-looking statements or forward-looking information. Such forward-looking information and statements are frequently identified by words such as "may," "will," "should," "anticipate," "plan," "expect," "believe," "estimate," "intend" and similar terminology, and reflect assumptions, estimates, opinions and analysis made by management of the Company in light of its experience, current conditions, expectations of future developments and other factors which it believes to be reasonable and relevant.

Risks and uncertainties that may cause actual results to vary include but are not limited to the availability of financing; fluctuations in commodity prices; changes to and compliance with applicable laws and regulations, including environmental laws and obtaining requisite permits and approvals; political, economic and other risks; as well as other risks and uncertainties which are more fully described in our annual and quarterly Management's Discussion and Analysis and in other filings made by us with Canadian securities regulatory authorities and available at www.sedarplus.ca. The Company disclaims any obligation to update or revise any forward-looking information or statements except as may be required.

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

SOURCE Principal Technologies Inc.