Abaxx Technologies Inc. — Capital/Financing Update 2021

Apr 14, 2021

ABAXX TECHNOLOGIES INC.

Terms and Conditions of Public Offering of Units

____________________________________________________________________________________________ April 9, 2021_

A preliminary short form prospectus containing important information relating to the securities described in this document has not yet been filed with the securities regulatory authorities in all of the provinces of Canada, except Québec. A copy of the preliminary short form prospectus, and any amendment, is required to be delivered to any investor that received this document and expressed an interest in acquiring the offered securities.

There will not be any sale or any acceptance of an offer to buy the securities until a receipt for the final short form prospectus has been issued.

This document does not provide full disclosure of all material facts relating to the securities offered. Investors should read the preliminary short form prospectus, the final short form prospectus and any amendment for disclosure of those facts, especially risk factors relating to the securities offered, before making an investment decision.

Offering:	Treasury Offering of 5,657,900 units (the “Units”) of Abaxx Technologies In.
	(the “Company”) (the “Offering”).
Unit Structure:	Each Unit will consist of one common share (a “Common Share”) in the capital
	of the Company and one-half of one Common Share purchase warrant (each full
	warrant, a “Warrant”). Each Warrant will entitle the holder thereof to acquire
	one Common Share (a “Warrant Share”) at an exercise price of C$5.10 for a
	period of 24 months following the Closing Date (as hereinafter defined).
Offering Price:	C$3.80 per Units (the “Offering Price”).
Size of Offering:	C$21,500,020 (up to C$24,725,023 in the event the Over-Allotment Option (as
	hereinafter defined) is exercised).
Over-Allotment Option:	The Underwriters shall have the option (“Over-Allotment Option”) to purchase
	up to an additional 848,685 Units from treasury at the same price and
	commission exercisable, in whole or in part, on or after the Closing Date and for
	a period of up to 30 days following Closing Date, solely for market stabilization
	purposes and to cover over-allotments, if any.
President’s List:	The Company may issue Units to purchasers on a “president’s list” on the same
	terms and conditions as the Offering (the “President’s List”).
Commission:	Cash commission equal to 6.0% of the gross proceeds of the Offering (including
	the Over-Allotment Option), other than in respect of any purchasers pursuant to
	the President’s List on which a cash commission equal to 3.0% shall be payable.
Jurisdiction	The Shares will be qualified in all of the provinces of Canada, except Québec
	(the “Jurisdictions”), pursuant to a short form prospectus. The Units may also
	be sold into the United States on a private placement basis to Qualified
	Institutional Buyers (QIBs) via an exemption from the registration requirements
	of the_United States Securities Act of 1933_, as amended. In addition, the Units
	may be sold in jurisdictions outside of Canada and the United States, in each
	case in accordance with all applicable laws provided that no prospectus,
	registration statement or similar document is required to be filed in such
	jurisdiction

Form of Underwriting

“Bought deal” basis subject to conventional bought deal termination provisions and closing conditions to be included in a definitive underwriting agreement.

Eligibility: The Units will be eligible for Canadian RRSPs, RRIFs, RDSPs, DPSPs, RESPs and TFSAs.

Standstill Period:

Lock-Up Period:

The Company agrees it shall not directly or indirectly offer, issue, pledge, sell, contract to sell, announce an intention to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise lend, transfer or dispose of, directly or indirectly, any common shares or securities convertible into or exchangeable for common shares of the Company, other than: (i) the issuance of common shares in connection with the exercise of any currently outstanding options of the Company, (ii) the issuance of options to acquire common shares pursuant to the Company’s stock option plan, and the issuance of common shares in connection with the exercise of any such options, (iii) the issuance of awards pursuant to the Company’s incentive award plan; (iv) the issuance of common shares pursuant to the dividend reinvestment plan of the Company, and (v) to satisfy any other currently outstanding instruments or other contractual commitments in relation to any transaction that has been disclosed to the Underwriters, for a period ending 90 days after the Closing Date.

It shall be a condition of the Offering that the senior management, directors of the board and the Principal Securityholders (as hereinafter defined) of the Company shall agree, in a lock-up agreement to be executed concurrently with the closing of the Offering that, for a period of 90 days following the closing of the Offering, it will not, directly or indirectly, offer, sell, dispose of or otherwise monetize the economic value of any securities in the Company beneficially owned by such shareholder, without the prior written consent of the underwriters, subject to the following exceptions: (i) if the Company receives an offer, which has not been withdrawn, to enter into a transaction or arrangement, or proposed transaction or arrangement, pursuant to which, if entered into or completed substantially in accordance with its terms, a party could, directly or indirectly acquire an interest (including an economic interest) in, or become the holder of, 100% of the total number of common shares in the Company, whether by way of takeover offer, scheme of arrangement, shareholder approved acquisition, capital reduction, share buyback, securities issue, reverse takeover, dual-listed Company structure or other synthetic merger, transaction or arrangement; (ii) in respect of sales to affiliates of such shareholder; and (iii) as a result of the death of any individual shareholder. Principal Securityholders shall be defined to include all securityholders of the Company that own, at the date hereof or the Closing Date, securities representing 10% of the outstanding equity of the Company, after giving effect to the exercise of convertible securities owned or controlled by them. The definitive terms of such lock-up agreement shall be negotiated between the parties in good faith and contain customary provisions.

Listing: The Company will cause the Common Shares and Warrant Shares issued in connection with the Offering to be listed on the Neo Stock Exchange at the time of Closing, which listing shall be a condition of Closing.

Use of Proceeds: Ongoing regulatory capital, working capital and general corporate purposes.

Underwriters: Cormark Securities Inc. & BMO Capital Markets Inc.

Closing Date:

The Offering will close on or before April 29, 2021, or such other date as Cormark and the Company may agree (the “ Closing Date ”).