edgeTI Converts Credit Facility with Lotus to Shares

ARLINGTON, Va., June 30, 2023 (GLOBE NEWSWIRE) -- Edge Total Intelligence Inc. (TSXV: CTRL, OTCQB: UNFYF, FSE: Q5i)(“edgeTI”, “We”, “Our” or the “Company”), is pleased to announce the settlement of debt owed by the Company to Lotus Domaine III LP ("Lotus"), an investment fund which is also a significant shareholder of the Company, under the line of credit dated June 1, 2022, as amended (the "Credit Facility"). The Company has issued an aggregate of 9,109,541 subordinate voting shares of the Company ("SVS") at a deemed price of CA $0.90 per SVS (the "Debt Shares") for the settlement of US $6,185,278.79, being the principal amount plus interest accrued, owed under the Credit Facility (the "Debt Settlement").

In a news release dated March 20, 2023, the Company announced that it amended the Credit Facility to include a new conversion option that allows the Company to convert the debt owed under the Credit Facility into SVS. The Company also announced that it approved the issuance of a warrant to the Lotus (the "Warrant") to purchase 75,000 SVS a price of CA $0.01 per SVS. The Warrant has a cashless exercise feature and a ten-year term.

All SVS issued pursuant to the Debt Settlement are subject to a statutory four (4) month hold period from the date of the issuance. Completion of the Debt Settlement is subject to receipt of all required regulatory approvals, including final acceptance by the TSX Venture Exchange.

Once the Debt Settlement is approved and the Debt Shares are issued, the Credit Facility will be extinguished.

As a result of Lotus being a control person of the Company, the Credit Facility is considered a "related party transaction" under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The Company is relying on the exemptions from (i) the formal valuation provisions of MI 61-101 as set out in section 5.5(b) of MI 61-101 (Issuer Not Listed on Specified Markets) on the basis that the Company is a TSX Venture Exchange listed issuer and (ii) the minority approval provisions of MI 61-101 as set out in section 5.7(1)(a) of MI 61-101 (Fair Market Value Not More than 25% of Market Capitalization) on the basis that the fair market value of the Credit Facility, insofar as interested parties are involved, will not exceed 25% of the market capitalization of the Company. The disinterested directors of the Company approved the Credit Facility and no materially contrary view or abstention was expressed or made by any director of the Company in relation thereto.