SQI Diagnostics Inc. (TSX-V: SQD) (OTCQB: SQIDF), a life sciences and diagnostics company that develops and commercializes proprietary technologies and products for advanced microarray diagnostics, today announced that it has completed the first tranche of a non-brokered private placement of 25,775,005 units of the Company at a price of $0.08 per Unit for gross proceeds of approximately $2.1 million. Each Unit consists of one common share and one common share purchase warrant. Each common share purchase warrant entitles the holder to purchase one common share at a price of $0.11 for a period of five years from the date of issuance, subject to accelerated expiry in certain circumstances.

Insiders of the Company, who are control persons, subscribed for an aggregate of 25,000,005 Units for gross proceeds of approximately $2,000,000 under the Private Placement. The issuances of Units to insiders pursuant to the Private Placement are considered related party transactions within the meaning of TSX Venture Exchange Policy 5.9 and Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (“MI 61-101“). The Company relied on exemptions from the formal valuation and minority approval requirements in sections 5.5(g) and 5.7(1)(e) of MI 61-101 in respect of such insider participation on the basis of financial hardship. Further details will be provided in the Company’s material change report to be filed on SEDAR.

The Company intends to complete the second tranche of the Private Placement on or about March 8, 2019 by issuing up to an additional 5,475,000 Units at a price of $0.08 per Unit, for additional gross proceeds of up to approximately $400,000.

The Private Placement is subject to all necessary regulatory and stock exchange approvals.  The securities issued pursuant to the first tranche of the Private Placement will be subject to a hold period expiring July 2, 2019, in accordance with applicable Canadian securities law.

SQI intends to use the net proceeds of the Private Placement to fund the Company’s product commercialization and manufacturing programs, sales and marketing and for general working capital purposes.

The Company did not file a material change report in respect of the related party transaction less than 21 days prior to the closing of the Private Placement, which the Company deems reasonable in the circumstances so as to be able to avail itself of the proceeds of the Private Placement in an expeditious manner.

The securities described herein have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act“) or any state securities laws and accordingly may not be offered or sold within the United States or to “U.S. persons”, as such term is defined in Regulation S promulgated under the U.S. Securities Act, except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities requirements or pursuant to exemptions therefrom. This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the Company’s securities to, or for the account of benefit of, persons in the United States or U.S. Persons.

About SQI Diagnostics

SQI Diagnostics is a life sciences and diagnostics company that develops and commercializes proprietary technologies and products for advanced microarray diagnostics. The Company’s proprietary microarray tests and fully-automated systems are designed to simplify protein and antibody testing workflow, increase throughput, reduce costs and provide excellent data quality.