Ms. Miriam Tuerk reports

CLEAR BLUE TECHNOLOGIES ANNOUNCES CLOSING OF SHARES FOR DEBT SETTLEMENT AND PRIVATE PLACEMENT

Further to Clear Blue Technologies International Inc.'s news release dated Dec. 27, 2024, the company has completed its previously announced shares for debt transaction and has settled an aggregate amount of approximately $8.77-million of debt into equity of the company, as well as completed its non-brokered private placement unit offering for approximately $1,575,000.

Shares for debt settlement

The company entered into debt settlement agreements with certain debenture holders and other creditors and settled an aggregate of approximately $8.77-million indebtedness that was converted into units of the company, with each unit comprising one common share and one common share purchase warrant at a price per unit of three cents, with each warrant exercisable for 24 months at a strike price of five cents. An aggregate of 292,438,847 common shares and 272,503,847 warrants were issued upon the closing of the shares for debt transaction.

Pursuant to the shares for debt transaction, BDC Capital Inc., a wholly owned subsidiary of the Business Development Bank of Canada (BDC), elected to convert $2.2-million in principal and accrued interest on its 10 per cent unsecured convertible debenture dated Oct. 21, 2024, into units and received an aggregate of 73,333,333 common shares and 73,333,333 warrants.

Immediately prior to the shares for debt transaction, BDC beneficially owned or had control or direction over, directly or indirectly, an aggregate of 4.9 million common shares and $2-million principal amount of its convertible debenture, which principal was initially convertible into units comprising one common share and one-half of one warrant at a price of 40 cents per unit, representing approximately 3.93 per cent of the issued and outstanding common shares on a non-diluted basis, and 9.39 per cent of the common shares on a partially diluted basis, assuming conversion of the convertible debenture and exercise of the warrants held by BDC Capital only.

Further to the shares for debt transaction, BDC beneficially owns or has control or direction over 78,233,333 common shares and 73,333,333 warrants, representing approximately 16.66 per cent of the issued and outstanding common shares on a non-diluted basis, and 27.92 per cent of the common shares on a partially diluted basis, assuming exercise of the warrants held by BDC Capital only.

BDC Capital converted the convertible debenture into units as a result of the shares for debt transaction. BDC or BDC Capital may, depending on market and other conditions and subject to applicable securities regulation, change their beneficial ownership of (or control or direction over) common shares or other securities of the company, whether in the open market, by privately negotiated agreements, or otherwise. Any transaction that BDC or BDC Capital may pursue may be made at any time and from time to time without prior notice and will depend on a variety of factors, including, without limitation, the price and availability of the company's securities, subsequent developments affecting the company, its business and prospects, other investment and business opportunities available to BDC or BDC Capital, general industry and economic conditions, the securities markets in general, and other factors deemed relevant by BDC or BDC Capital.

An early warning report relating to this transaction will be filed on SEDAR+ under the company's profile. BDC is Canada's business development bank, a financial institution dedicated exclusively to entrepreneurs. The head office of the BDC is located at 5 Pl. Ville-Marie, ground floor, Montreal, Que., H3B 2G2. For more information about BDC or to obtain a copy of the early warning report, contact Phil Taylor at Phil.Taylor@bdc.ca or 343-961-4859. The head office of the company is located at 30 Lesmill Rd., Unit 7, Toronto, Ont., M3B 2T6.

Certain directors, officers and other insiders of the company settled an aggregate of $598,050 worth of debt in exchange for an aggregate of 19,935,001 common shares in the shares for debt transaction, and the participation of insiders is considered a related party transaction subject to Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions. The issuance of securities to the related parties is exempt from the formal valuation requirements of Section 5.4 of MI 61-101 pursuant to Subsection 5.5(b) of MI 61-101 and exempt from the minority shareholder approval requirements of Section 5.6 of MI 61-101 pursuant to Subsection 5.7(1)(a) of MI 61-101.

Private placement

The company also completed its private placement unit offering comprised of one common share and one warrant at a price per unit of three cents, with each warrant exercisable for 24 months at a strike price of five cents, for a total of $1,575,069. The net proceeds from the private placement will be used for working capital and general corporate purposes. An aggregate of 52,502,300 common shares and 52,502,300 warrants were issued upon the closing of the private placement.

In connection with the closing of the private placement, the company paid aggregate finders' fees of $5,109.72 in cash and 170,324 finders' warrants to certain finders. Each finder warrant will entitle the holder thereof to purchase one common share at a price of five cents for a period of 24 months from the grant date.

Certain directors, officers and other insiders of the company participated in the private placement in the aggregate of $1,407,511 and were issued 46,917,033 units on closing, and the participation of insiders is considered a related party transaction subject to MI 61-101. The issuance of securities is exempt from the formal valuation requirements of Section 5.4 of MI 61-101 pursuant to Subsection 5.5(b) of MI 61-101 as the common shares of the company are listed on the TSX-V. The issuance of securities is also exempt from the minority approval requirements of Section 5.6 of MI 61-101 pursuant to Subsection 5.7(1)(b) of MI 61-101 as the fair market value was less than $2.5-million. The closing of insiders in the private placement remains subject to the final approval of the TSX Venture Exchange and all securities issued to insiders pursuant to the private placement will be held in escrow pending exchange approval.

The completion of both the shares for debt transaction and private placement remains subject to the final approval of the TSX Venture Exchange. The securities issued pursuant to the shares for debt transaction and private placement are subject to a hold period of four months and one day from the issuance date in accordance with applicable securities laws.

Proposed share consolidation

The company also announces a plan to proceed with a consolidation of its issued and outstanding common shares on the basis of one postconsolidation share for six preconsolidation shares. The company believes that the consolidation is in the best interests of shareholders as it will allow the company to complete the transactions in accordance with abiding by TSX-V policies as well as enhance the marketability of the common shares. Accordingly, the company plans to hold a special meeting of shareholders on or around the beginning of March, 2025, prior to which time an information circular will be sent to shareholders containing additional details pertaining to the consolidation. No fractional shares will be issued as a result of the consolidation. Any fractional shares resulting from the consolidation will be rounded down to the next whole common share.

About Clear Blue Technologies International Inc.

Clear Blue Technologies International was founded on a vision of delivering clean, managed, "wireless power" to meet the global need for reliable, low-cost, solar and hybrid power for lighting, telecom, security, Internet of Things devices, and other mission-critical systems. Today, Clear Blue has thousands of systems under management across 37 countries, including the United States and Canada.

We seek Safe Harbor.