SEB Smart Employee Benefits Inc

Smart Employee Benefits Inc. (“SEB” or the “Company”) (TSXV: SEB) (OTCQB: SEBFF) a leader in benefits processing solutions and services today announced that it has entered into a third amending agreement to its secured revolving credit facility agreement (the “Credit Agreement”) with its international asset-focused lender (the “Lender”) to, among other things, extend availability to $15,000,000 under the existing Credit Agreement.

Co-operators Financial Services Limited (“Co-operators”), a strategic investor in SEB, previously provided a limited guarantee (the “Initial Guarantee”) of $5,000,000 in favour of the Lender, which Initial Guarantee permitted SEB to access $5,000,000 of unutilized commitment under the Credit Agreement.

Subsequently, Co-operators provided an amended and restated limited guarantee dated March 8, 2022 (the “Existing Guarantee”) pursuant to which the Initial Guarantee was amended and restated and SEB issued a promissory note dated March 8, 2022 in favour of Co-operators (the “Promissory Note”), to evidence that amounts paid, if any, by Co-operators to the Lender under the Existing Guarantee would be deemed to be a loan outstanding in the same amount, owing by SEB to Co-operators under the Promissory Note.

In conjunction with the third amending agreement to the Credit Agreement, Co-operators has provided an amended and restated limited guarantee dated June 24, 2022 (the “Amended and Restated Limited Guarantee”) in favour of the Lender in the amount of $10,000,000, and, accordingly, SEB has issued a corresponding amended and restated promissory note in favour of Co-operators dated June 24, 2022 (the “Amended and Restated Promissory Note”). In the future, should the Lender call on the Amended and Restated Limited Guarantee, any amount paid by Co-operators to the Lender would be deemed to be a repayment under the Credit Agreement and as a result such amount would also be deemed to be owing by SEB to Co-operators under the Amended and Restated Promissory Note. SEB shall be entitled to repay interest under the Amended and Restated Promissory Note in shares, and any such share issuance shall be subject to applicable regulatory and TSX Venture Exchange approval at the time of such share issuance.

Co-operators currently holds a $20,000,000 convertible debenture issued by SEB dated November 30, 2020, as well as a $5,000,000 convertible debenture dated March 8, 2022 (collectively the “Debentures”). The Debentures and the Amended and Restated Promissory Note are secured by first ranking security over the software owned by SEB Administrative Services Inc., a wholly owned subsidiary of SEB, and second ranking security over the other assets of SEB and SEB Administrative Services Inc. An intercreditor agreement, as amended, between the Lender and Co-operators governs the security granted to the Lender pursuant to the Credit Agreement and to Co-operators pursuant to the Debentures and the Amended and Restated Promissory Note, as well as the relationship between the Lender and Co-operators as it relates to such security.

The issuance of the Amended and Restated Promissory Note accompanying the Amended and Restated Limited Guarantee may be considered a related party transaction within the meaning of TSXV Policy 5.9 and Multilateral Instrument 61-101 (“MI 61-101”). The Company relied on the exemptions from the valuation and minority shareholder approval requirements of MI 61-101 contained in Sections 5.5(b) (Company is listed on the TSXV) and 5.7(1)(a) (fair market value of the additional $5,000,000 contingent promissory note liability did not exceed 25% of the Company’s market capitalization) in respect of such transaction. A resolution of the board of directors of the Company was passed to approve the issuance of the Amended and Restated Promissory Note, with the two director appointees of Co-operators, abstaining from voting. No materially contrary view or abstention was exercised or made by any other director.

The Company did not file a material change report more than 21 days before the closing, which it considers reasonable in the circumstances, as the participation in the transaction by a related party of the Company was not definitive until shortly prior to closing.

About Smart Employee Benefits Inc.:SEB is an Insurtech company focused on Benefits Administration Technology driving two interrelated revenue streams – software/solutions and services. The Company is a proven provider of leading-edge IT and benefits processing software, solutions and services for the Life and Group benefits marketplace and government. We design, customize, build and manage mission critical, end-to-end technology, people and infrastructure solutions using SEB’s proprietary technologies and expertise and partner technologies. We manage mission critical business processes for over 150 blue chip and government accounts, nationally and globally. Over 90% of our revenue and contracts are multi-year recurring revenue streams contracts related to government, insurance, healthcare, benefits and e-commerce. Our solutions are supported nationally and globally by over 600 multi-certified technical professionals in a multi-lingual infrastructure, from multiple offices across Canada and globally.

Our solutions include both software and services driven ecosystems including multiple SaaS solutions, cloud solutions & services, managed services offering smart sourcing (near shore/offshore), managed security services, custom software development and support, professional services, deep systems integration expertise and multiple specialty practice areas including AI, CRM, BI, Portals, EDI, e-commerce, digital transformation, analytics, project management to mention a few. The Company has more than 20 strategic partnerships/relationships with leading global and regional technology and consulting organizations.

Forward-Looking StatementsCertain information in this release, may constitute forward-looking information. In some cases, but not necessarily in all cases, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “targets”, “expects” or “does not expect”, “is expected”, “an opportunity exists”, “is positioned”, “estimates”, “intends”, “assumes”, “anticipates” or “does not anticipate” or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might”, “will” or “will be taken”, “occur” or “be achieved”. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts but instead represent management’s expectations, estimates and projections regarding future events.

THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS RELEASE REPRESENTS THE COMPANY’S CURRENT EXPECTATIONS AND, ACCORDINGLY, IS SUBJECT TO CHANGE. HOWEVER, THE COMPANY EXPRESSLY DISCLAIMS ANY INTENTION OR OBLIGATION TO UPDATE OR REVISE ANY FORWARD-LOOKING INFORMATION, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE, EXCEPT AS REQUIRED BY APPLICABLE LAW.

Neither TSX Venture Exchange Inc. nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange Inc.) accepts responsibility for the adequacy or accuracy of this release.

All figures are in Canadian dollars unless otherwise stated.

Media and Investor ContactJohn McKimmPresident/CEO/CIOOffice (888) 939-8885 x 2354Cell (416) 460-2817john.mckimm@seb-inc.comwww.seb-inc.com