TruTrace Technologies Inc. — Capital/Financing Update 2020

Sep 29, 2020

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TruTrace Technologies Inc. Announces Postponement in Filing of First Quarter Statements

Toro n to, Ontari o – September 28, 2020 , TruTrace Technologies Inc. ( CSE: TTT; OTCQB: TTTSF ) (“ TruTrace ” or the “ Company ”), developer o f a fully-integrated block c hain platfo r m for the le g al cannabi s , food and p harmaceuti c al industri e s, announces that it will not be i n a positio n to file its fi n ancial stat e ments for t h e first fisca l quarter for the th r ee months e nded July 31, 2020 and the related m anagemen t 's discussio n and analy s is, as required by Part 4 and Part 5 o f National I nstrument 5 1-102: Con t inuous Discl o sure Oblig a tions (colle c tively, the "Quarterly F i lings") by t h e filing de a dline of Septe m ber 29, 20 2 0.

This n ews release is being iss u ed in accor d ance with t he blanket r elief of a 4 5 -day exten s ion, provid e d by Canadian Securiti e s Administ r ators and O ntario Instr u ment 51-502: Temp o rary Exem p tion from C ertain Corporate Finan c e Require m ents, for pe r iodic filing s norm a lly required to be made by issuers.

In res p onse to rec e nt proclam a tions from C anadian h e alth authori t ies and the challenges result i ng from the COVID-19 pandemic, t he Compan y has taken t he necessa r y precautio n s to pro t ect the heal t h and safet y of its emp l oyees and t h e public. Accordingly, a significan t portio n of the Co m pany's staf f as well as i ts auditor's s taff have b e en workin g from home, and tr a vel for in- p erson meeti n gs has bee n curtailed. W hile work i ng remotel y , the coord i nation of ta s ks and wor k product h a s been mor e difficult, t h e completi o n of audit proce d ures due to limited acc e ss to paper - based supp o rting evide n ce has bee n delayed, a n d the en t ire audit pr o cess has b e en slowed. F urthermor e , since the C ompany's v arious suppliers and clie n ts have als o been work i ng remotel y , their resp o nses to sta n dard audit inquir i es have slo w ed, including responses from sign i ficant Com p any clients. In light of these c ircumstanc e s, the Com p any was fo r ced to post p one the fili n g of its au d ited annual finan c ial stateme n ts for the fi s cal year en d ed April 30, 2020 (coll e ctively the “ Annual Filings”) until no l ater than O c tober 12, 2 0 20.

The c h allenges p o sed by CO V ID-19 and t he subsequ e nt delay in t he filing of the Annual Filings have resul t ed in a delay in the fin a lization and filing of th e Quarterly F ilings. Howe v er, the Co m pany's boa r d of directo r s and its m a nagement c onfirm that they are worki n g expediti o usly to mee t the Comp a ny's obligat i ons relatin g to the filin g of the Quart e rly Filings. At this tim e , the Comp a ny anticipa t es being ab l e to compl e te the Quart e rly Filings o n or before November 13, 2020.

The C ompany co n firms that i t s managem e nt and othe r insiders ar e subject to an insider tradin g black-out p olicy that reflects the principles in section 9 o f National P o licy 1 1-20 7 : Failure-to-File Cease Trade O rders and R e vocations i n Multiple J urisdictions, such that

they are in a black-out period until the end of the second trading day after the Annual Filings have been disclosed by way of a news release.

Since March 27, 2020, the date of filing of the Company’s unaudited interim financial statements for the three months ended January 31, 2020, the Company has announced:

On June 26, 2020, the Company announced that it settled CAD $950,000 of indebtedness previously owed to Heated Details, Inc., the primary vendor responsible for software development, design and maintenance of the Company’s proprietary StrainSecure™ platform and thereby securing all rights to TruTrace’s intellectual property.

On July 3, 2020, the Company announced it signed a software license agreement with OrionOne Global, Inc., a global supply chain provider delivering best-in-class technology which serves as a logistics and tracking smart-hub for navigating shipments and logistics worldwide.

On July 3, 2020, the Company announced the acquisition, by way of private transactions, of control and direction over an aggregate of 17,200,000 common shares in the capital of the Company by Thomas Stephenson, Chief Technology Office of the Company.

On August, 14, 2020, the Company advised the Security Holders that the Annual General and Special Meeting of the Company is to be held on October 16, 2020

On August 25, 2020, the Company announced that it teamed with Riviera & West One Logistics to ensure the highest quality for its line of products including Hygen-X™ hand and surface sanitizer products.

On August 26, 2020, the Company announced that medical distributor, Safe Company selected the TruTrace Enterprise™ SaaS platform to manage inventory and quality assurance processes for its medical and protective consumables, hospital supplies and air purification solutions.

On September 2, 2020, the Company announced the closing of a non-brokered private placement financing (the “Financing”) of subordinated secured convertible debentures (each, a “Debenture”) pursuant to which the Company issued Debentures in the aggregate principal amount of $360,000 (the “Principal Amount”) to subscribers to the Financing. The terms of the Debentures include a maturity date of three years from the date of issuance (the “Maturity Date”) and the principal amount of a Debenture, together with any accrued and unpaid interest, will be payable on the Maturity Date, unless earlier converted in accordance with its terms. Each debenture bears interest (the “Interest”) at the rate of 8.25% per annum, which Interest will be payable monthly in arrears, unless earlier converted.

The principal amount of a Debenture, together with all accrued and unpaid interest thereon, is convertible into units of the Company (each, a “Debenture Unit”), at the option of the holder, at a conversion price of $0.05 per Debenture Unit (the “Conversion Price”), with each Debenture Unit comprised of one common share of the Company (each, a “Debenture Share”) and one transferable share purchase warrant (each, a “Debenture Warrant”), with each Debenture Warrant exercisable into one additional Debenture Share (each, a

“Debenture Warrant Share”) at an exercise price of $0.05 per Debenture Warrant Share for a period of two years from the date of issue.

The Company has the right, at its sole option and, at any time prior to the Maturity Date, to require the holder to convert all or any portion of the outstanding Principal Amount and any accrued but unpaid Interest thereon into Debenture Units at the Conversion Price if the daily volume-weighted average price of the common shares of the Company on the Canadian Securities Exchange (or such other stock exchange on which the common shares may be traded at such time) for any 10 day consecutive trading day period is greater than $0.20, subject to adjustment as provided for in the certificate representing the Debenture.

The Company also announced that a holder of a debenture issued in October 2019 has agreed to convert an outstanding debenture with an amount owing of $213,538 into 4,273,160 common shares in the capital of the Company, at a revised conversion price of $0.05 per share, in full settlement of the amount owing under the debenture. The debenture had been previously convertible into a conversion unit at a price of $0.25 per conversion unit, with each such conversion unit comprised of a common share and a share purchase warrant exercisable at $0.30 per share.

The Canadian Securities Exchange has not reviewed this news release and does not accept responsibility for the adequacy or accuracy of this news release.

On behalf of the Board of Directors:

Robert Galarza, Chief Executive Officer and Director For More Information: Robert Galarza, Chief Executive Officer and Director, 888-775-4888

Disclaimer for Forward-Looking Information

This news release contains forward-looking information that involves various risks and uncertainties regarding future events. Such forward-looking information can include without limitation statements based on current expectations involving a number of risks and uncertainties and are not guarantees of future performance of the Company. Forwardlooking statements made in this news release relate to the anticipated timing of the Quarterly Filings. There are numerous risks and uncertainties that could cause actual results and the Company’s plans and objectives to differ materially from those expressed in the forward-looking information, including adverse market conditions. Actual results and future events could differ materially from those anticipated in such information. These and all subsequent written and oral forward-looking information are based on estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice. The Company disclaims any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.