Mr. George Burnes reports

SMARTCOOL ANNOUNCES CLOSING OF PRIVATE PLACEMENT

Smartcool Systems Inc. has closed the second tranche of a non-brokered private placement offering of up to eight million units at a price of 2.5 cents per unit. In the second tranche, the company sold 800,000 units for gross proceeds of $20,000. The company intends to close the third and final tranche of this offering on or before Oct. 24, 2016. The company intends to use most of the proceeds from the offering to pay accrued liabilities and to repurchase inventory from a distributor. It anticipates that approximately 13 per cent will be available for general working capital.

Each unit sold was composed of one common share in the capital of the company and one non-transferable share purchase warrant. Each warrant will entitle the holder to purchase one additional share in the capital of the company for a period of 12 months from the closing date at an exercise price of five cents.

All of the securities issued in the second tranche of the offering are subject to a hold period expiring Jan. 30, 2017. The warrants are not transferable.

We seek Safe Harbor.