News release.NEWS RELEASE TekModo Approves Rights Offering with Standby Guarantees in Lieu of Private Placement. Revises Share Consolidation and Enters into Loan Agreements March 15, 2017 – Vancouver, British Columbia – After careful consideration and discussions with its stakeholders and potential financiers, TekModo Industries Inc. (TSX-V: TEK) (“TekModo” or the “Company”) announces that it will be proceeding with a rights offering (the “Rights Offering”), instead of the previously announced non-brokered private placement of up to 15,000,000 units at a price of C$0.20 per unit (post 1:5 consolidation). The full amount of the Rights Offering is expected to be approximately $2.17 million (CDN), and a standby guarantee, to be provided by Jake Vogel and John Proust will ensure that a minimum of $2 million is raised. In order to ensure that TekModo can meet its short term capital requirements, Mr. Vogel and Mr. Proust (the “Standby Purchasers”) have agreed to lend the Company $2 million (CDN), which will allow the Company to seamlessly continue its operations until the launch and closing of the Rights Offering. In addition, the Company announces that it will be modifying the previously announced share consolidation from 1:5 to 1:2.5. Rights Offering The Company intends to proceed with the Rights Offering pursuant to which TekModo will offer rights (the “Rights”) to holders of its common shares on the record date for the Rights Offering, on the basis of one Right for each common share held. The record date for the Rights Offering has not yet been determined. Each Right will entitle the holder to subscribe for one unit of the Company (a “Unit”) at a subscription price of C$0.015 per Unit. Each Unit will consist of one pre-consolidated common share and one share purchase warrant (a “Warrant”). Each Warrant will be exercisable into one pre-consolidated common share for a period of 5 years from the issuance date of the Units, at a price equal to the last closing price of the Company’s common shares prior to the announcement of the Rights Offering. The share consolidation will occur immediately after closing and the number of common shares, the common shares issued upon exercise of the warrants and the exercise price of the warrants will be adjusted accordingly. The Company will make application to have the Rights listed for trading on the TSX Venture Exchange. The Company intends to use the proceeds of the Rights Offering to provide working capital for the company and/or repay the loans made to the Company that are being provided as an advance against the standby guarantee. The Company will provide further details respecting the Rights Offering, including the record date for determining shareholders entitled to receive rights under the Rights Offering, when determined. Standby Guarantee In connection with the Rights Offering, the Company intends to enter into a standby agreement (the “Standby Guarantee”) with the Standby Purchasers. Under the Standby Guarantee, the Standby Purchasers have agreed to subscribe for, and the Company has agreed to issue, all Units offered under the Rights Offering that are not otherwise purchased by the Company’s shareholders. The Standby Guarantee will be approved by the independent directors of the Company. As consideration for the Standby Guarantee, the Company has agreed to issue bonus warrants to the Standby Purchasers, equal to up to 25% of the amount of the Standby Guarantee and as permitted under TSX Venture Exchange Policies. The bonus warrants will be exercisable into pre-consolidated shares at a price equal to the last closing price of the of the Company’s common shares prior to the announcement of the Rights Offering with the exercise price and the number of warrant shares to be adjusted after the share consolidation. The Rights Offering will be subject to regulatory approval, including the approval of the TSX Venture Exchange. Additional details respecting the Rights Offering will be disclosed in a subsequent news release, a Rights Offering Notice and Rights Offering Circular to be prepared in accordance with applicable Canadian securities laws. Loan Agreements In connection with and as an advance against the Standby Guarantee, the Company will enter into loan agreements with the Standby Purchasers. The Standby Purchasers will advance up to $2 million (CDN), immediately to TekModo in order to meet its short term capital requirements. The loans will be unsecured, mature on the earlier of the completion of the Rights Offering or September 30, 2017 and bear interest at a rate of 8% per annum. The acquisition cost of any Units acquired by the Standby Purchasers pursuant to the exercise of Rights, either under the Standby Guarantee or as holders of Rights, will be satisfied by the reduction of the amounts payable to the standby guarantors under the loan agreements. The loans constitute “related party transactions” within the meaning of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (“MI 61-101”) because funds have been provided by two directors of the Company. MI 61-101 has been adopted by the TSX Venture Exchange as Policy 5.9 Protection of Minority Security Holders in Special Transactions. The Company is relying on the exemptions from the formal valuation and minority approval requirements contained in Sections 5.5(c) and 5.7(1)(b) of MI 61-101, on the basis that the transaction constitutes a distribution of securities for cash and the consideration received does not exceed $2,500,000. The loan is subject to approval of the TSX Venture Exchange. This news release is not an offer of securities for sale in the United States. The offer and sale of the securities offered in the Rights Offering has not been and will not be registered under the US Securities Act of 1933, as amended, or any state securities laws, and such securities may not be offered or sold in the United States absent registration or applicable exemption from such registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the United States or in any jurisdiction in which the offer, sale or solicitation would be unlawful.