VANCOUVER, OCTOBER [•], 2020 – TAAT LIFESTYLE & WELLNESS LTD. (CSE: TAAT)  (OTCQB: TOBAF) (FRANKFURT: 2TP2) (the “Company” or “Taat”) is pleased to announce  that it has closed a private placement of CAD $6,750,000 (the “Placement”) in escrow, subject to  the Company confirming the delivery of the closing proceeds. The subscribers to the Placement  were a group of investors including Ms. Debbie Chang, co-founder of Horizons Ventures, in her  personal capacity. The Placement is intended to help bolster the Company’s early-stage  performance as it prepares to launch Taat, a tobacco-free and nicotine-free combustible analogue  to cigarettes, in the United States later this quarter.  

Beyond Tobacco™, the base material of Taat, has been meticulously engineered to mimic the  experience of smoking actual tobacco despite containing no nicotine or tobacco whatsoever. Taat  is offered in a combustible format with a realistic tobacco scent and taste created using a patent pending refinement technique for the Beyond Tobacco™ base material. In mid-2020 retail market  testing in California and Nevada, legal-aged current tobacco smokers who sampled Taat for the  first time indicated there were no significant experiential differences in comparison to smoking  traditional tobacco cigarettes. The Company anticipates this similarity can be attractive to the  large segment of the global population of 1.3 billion tobacco users that aspires to leave nicotine  behind. For clarity, Taat is intended only for use by current tobacco smokers of legal age who  would prefer the option of a nicotine-free combustible product. Marketing will be directed  exclusively towards this segment, as it is not Taat’s objective to recruit new smokers. 

In an October 6, 2020 press release issued by Taat, it announced an initial purchase order after  entering into a binding distribution agreement with a large tobacco wholesaler in the state of Ohio,  where Taat is to be launched. Under this distribution agreement, Taat would be distributed to  convenience channel retailers among top global cigarette brands (e.g., Marlboro, Newport,  Camel) across Taat’s launch market. 

In September 2020, the World Health Organization (“WHO”) issued a notice outlining the  importance of tobacco control in China as it recovers from the COVID-19 pandemic. Data from  the WHO also indicates the total economic cost of smoking in China rose by 1,000% between  2000 and 2014, with one death from tobacco use occurring approximately every thirty seconds.  In addition to the public health and economic burdens of tobacco consumption, tobacco  production has also been known to have an adverse environmental impact. As Taat does not  require any tobacco, its potential to lessen the effects of tobacco production offers another  dimension of possible impact in addition to the product’s consumer-level utility. 

With the CAD $6.75 million raised in the Placement, the Company intends to expand its currently  planned initiatives for launching Taat in the state of Ohio. This capital is also to be applied towards  further research and development of both Taat and the Beyond Tobacco™ base material, as well  as possible entry into additional markets in the United States.

Taat Chief Executive Officer Setti Coscarella commented, “It is with pleasure that I announce the  closing of the Placement in Taat. With our experience-driven analogue to tobacco cigarettes that  contains no tobacco or nicotine, our objective is to provide a choice for current tobacco smokers  of legal age to leave nicotine behind. In doing so, we seek to create meaningful social, economic,  and humanitarian impact by helping to alleviate the effects of tobacco use and production.” 

Private Placement The Company’s non-brokered private placement (the “Offering”) of units (the “Units”) with the  Investor, has raised gross proceeds of CAD $6.75 million (or approximately USD $5 million).  Pursuant to the Offering, the Company sold an aggregate of 5,192,308 Units, each Unit was  issued at a price of CAD $1.30 and comprised of one common share of the Company (each a  “Common Share”) and one common share purchase warrant (each whole warrant, a “Warrant”)  of the Company. Each Warrant is exercisable to acquire one Common Share of the Company for  a period of 12 months following the closing date at an exercise price of CAD $2.00 per Common  Share. The Warrants are subject to an acceleration clause should the Common Shares have a  closing price on the Canadian Securities Exchange (or such other exchange on which the  Common Shares may be traded at such time) of CAD $3.00 or greater per Common Share for a  period of five (5) consecutive trading days at any time that is four months and one day from the  closing date, in which event the Company may notify warrantholders that the Warrants must be  exercised within a period of 30 days, or they will expire. All securities issued or issuable pursuant  to the Offering are subject to a hold period of four months and one day.