Mr. Johnson Joseph reports

TENET CLOSES FIRST TRANCHE OF CAD$2.59M OF PRIVATE PLACEMENT OF CONVERTIBLE DEBENTURE UNITS

Further to Tenet Fintech Group Inc.'s press release of June 29, 2023, in which it disclosed an intention to complete financings for gross proceeds of up to $20-million, the company has issued and completed a first tranche closing of the financing with the sale of 2,598 units comprising convertible debentures and warrants by way of non-brokered private placement financing at a price of $1,000 per unit for gross proceeds of approximately $2,598,000. In addition, the company has entered into subscription agreements [on the same terms] with certain investors for the sale of an additional 8,000 units for gross proceeds of an additional approximately $8-million and expects to receive the funds associated with the second tranche closing by Aug. 18, 2023, at which time Tenet expects to complete the second tranche closing of the financing. However, there can be no assurances that the company will receive such funds by Aug. 18, 2023, or at all, to be able to close on the second tranche closing or any additional tranches in the financing.

Each unit sold in the first tranche closing comprises: (i) one 10.0 per cent non-secured convertible debenture of the company in the principal amount of $1,000 and (ii) 4,000 warrants to purchase common shares of the company. The convertible debentures will mature 36 months from the date of issuance and, subject to prior conversion in accordance with their terms, will be repaid in cash at the maturity date. Each warrant will be exercisable to acquire one common share at an exercise price of 50 cents per warrant share for a period of 24 months from the date of issuance thereof.

From the date of issue until their maturity date, convertible debenture holders may elect to convert, in whole or in part, the face value of the convertible debentures into common shares at a conversion price of 25 cents per common share. At any time prior to the maturity date, if the common shares trade at a price of $5.00 or more for three consecutive trading days, any non-converted and remaining face value of the convertible debentures will be automatically converted into common shares at a conversion price of 25 cents per common share. Upon the conversion of the convertible debentures, the company will pay to the convertible debenture holders, in cash, the interest accrued on the convertible debentures for the amount converted up to but excluding the date of conversion.

The convertible debentures shall bear interest at a rate of 10.0 per cent per annum from the date of issue, payable monthly in arrears in cash. Interest shall be computed on the basis of a 360-day year composed of 12 30-day months.

Certain qualified individuals and registered investment dealers who assisted the company with respect to the financing received from the company, in compliance with securities laws, a cash finder's fee equal to 5 per cent of the gross proceeds of the financing that they helped place, and a warrant finder's fee equal to a number of warrants representing 5 per cent of the gross proceeds of the financing that they helped place. Each finder warrant entitles the holder to purchase one common share for a period of 24 months following the date of its issuance, at an exercise price of 50 cents.

The convertible debentures, the securities to be issued underlying the convertible debenture, the warrants, and the finder warrants and any underlying securities are subject to a hold period of four months and one day from the closing date of the financing. The first tranche closing, any additional closings and the financing are all subject to the approval of the Canadian Securities Exchange and are subject to compliance with applicable regulatory requirements, including National Instrument 45-106 -- Prospectus Exemptions.

Pursuant to Multilateral Instrument 61-101 respecting protection of minority security holders in special transactions, the financing constitutes a related party transaction as certain directors and officers of Tenet subscribed for a total of 2,000 units for aggregate insider proceeds of $2-million. In reviewing the applicable valuation requirements under MI 61-101, Tenet has determined that the exemption set out in Subsection 5.5(b) of MI 61-101 is applicable since no securities of the company are listed or quoted on the Toronto Stock Exchange, Aequitas NEO Exchange Inc., the New York Stock Exchange, the American Stock Exchange, the Nasdaq Stock Market or a stock exchange outside of Canada and the United States. The company has further determined that it is eligible under 5.7(1)(a) for the exemption from the minority shareholder approval requirement since neither the fair market value of the units issued to the related parties, nor the fair market value of the consideration paid for the units by the related parties exceeded 25 per cent of the company's market capitalization at the time the financing became legally binding. The board of directors of Tenet has unanimously approved the financing. Tenet did not file a material change report 21 days prior to the closing of the first tranche of the financing as participation of insiders had not been established at that time, and for sound business reasons the company determined to close the first tranche of the financing earlier than such date would otherwise permit.

Tenet plans to use the proceeds of the first tranche closing to meet its immediate cash needs and contribute to the completion of the remaining pillars of the business hub in Canada to allow the company to access a more diversified pool of SME data and position it to launch its first data-driven products in Canada later this year through its Tenoris3 subsidiary.

About Tenet Fintech Group Inc.

Tenet Fintech Group is the parent company of a group of innovative financial technology (fintech) and artificial intelligence (AI) companies. All references to Tenet in this news release, unless explicitly specified, includes Tenet and all its subsidiaries. Tenet's subsidiaries provide various analytics and AI-based services to businesses and financial institutions through the Cubeler business hub, a global ecosystem where analytics and AI are used to create opportunities and facilitate B2B (business-to-business) transactions among its members.

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