ECC VENTURES 5 CORP. PROVIDES UPDATE ON SHELFIE-TECH LTD. QUALIFYING TRANSACTION

/NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES./

VANCOUVER, BC, Sept. 11, 2023 /CNW/ - ECC Ventures 5 Corp. (the "Company" or "ECC5") (TSXV: ECCV.P) further to its news releases dated May 16, 2022 and May 10, 2023, is pleased to provide an update on its proposed qualifying transaction to acquire (the "Acquisition"), through its subsidiary, 1360621 B.C. Ltd. ("Acquireco"), all the issued and outstanding share capital of Shelfie-Tech Ltd. ("Shelfie").  The Acquisition will constitute a reverse take-over and the Company's qualifying transaction under the policies of the TSX Venture Exchange (the "Exchange").  Upon closing, ECC5 will change its name to Shelfie-Tech Ltd.

Shelfie is a private company incorporated on November 18, 2021 pursuant to the laws of Israel.  Shelfie's principal activities have been the development of an artificial intelligence powered real time shelf inventory analytics robotic platform. Shelfie's innovative solution consists of a digital image capturing system and a centralized management system that provides real-time visibility into the retail shelf supply, pinpointing the exact products running low on inventory, allowing for rapid remediation and an enhanced customer experience.

For the year ended December 31, 2022 (unaudited), Shelfie had assets of US$351,887, liabilities of US$215,523, working capital of US$136,364, and additional paid in capital of US$1,940,556.  Shelfie has completed a significant portion of its planned R&D, and expects to fully commercialize its patent pending system before the end of 2023.

For more information regarding Shelfie, please visit its website at www.shelfietech.com.

The parties have agreed to certain amendments to the terms of the Acquisition pursuant to an amendment dated August 30, 2023 (the "Amendment Agreement") to the definitive arrangement agreement (the "Arrangement Agreement") previously announced by ECC5.  Pursuant to the amended terms, (i) ECC5 will, concurrently with the closing of the Acquisition, complete a forward share split of its common shares on a 1.375 to 1 basis (the "Forward Split"), (ii) current shareholders of Shelfie will be issued an aggregate of 77,861,993 post-Forward Split common shares of ECC5 (the "Resulting Issuer Shares"), prior to any additional Shelfie common shares that may be issued in connection with the Shelfie Financing (as described below), at a deemed price of $0.35 per share, in exchange for their shares of Shelfie, and (iii) ECC5 and Shelfie will complete the Financing and the Shelfie Financing, on amended terms, as described below. Certain of the shares issued to Shelfie shareholders will be subject to escrow and resale restrictions pursuant to the policies of the Exchange. The terms of the Amendment Agreement are subject to the approval of the shareholders of Shelfie and the Supreme Court (British Columbia).

The Acquisition will be completed by way of a plan of arrangement.

The Company will also issue 150,000  Resulting Issuer Shares to an arm's length party, The Hayde Family Revocable Trust, a trust controlled by William Hayde, in connection with the Acquisition, at a deemed price of $0.35 per share.  Payment of the finder's fee remains subject to Exchange acceptance.

Upon closing of the Acquisition, current securityholders of ECC5 will own 7,768,750 Resulting Issuer Shares, 2,750,000 of which will be subject to escrow provisions pursuant to the policies of the Exchange, 275,000 agents options exercisable at $0.07 Resulting Issuer Share until December 16, 2026, and 776,875 stock options exercisable at $0.07 per Resulting Issuer Share exercisable until one year from closing of the Acquisition, subject to the provisions of the Company's stock option plan.

As a condition to completing the Acquisition, the parties intend to complete a non-brokered private placement financing (the "Financing") of subscription receipts through Acquireco (the "Subscription Receipts") through the issuance of up to 9,000,000 Subscription Receipts at a price of US$0.26 (CAD$0.35) per Subscription Receipt for gross proceeds of up to US$2,340,000 (CAD$3,150,000).

The proceeds of the Financing will be held in escrow, pending the Company receiving all applicable regulatory approvals, and completing all matters and conditions relating to the Acquisition, including the Forward Split.  Immediately prior to the completion of the Acquisition, on satisfaction of the escrow conditions, each Subscription Receipt will automatically be exchanged, for no further consideration and with no further action on the part of the holder thereof, to acquire one common share of Acquireco.  Each Acquireco common share issuable on exercise of the Subscription Receipts will be exchanged for one Resulting Issuer Share in connection with the Acquisition.  In the event that the Acquisition is not completed, each Subscription Receipt will be cancelled, and the subscription funds will be returned to the subscribers. 

Also, Shelfie intends to complete a non-brokered private placement of common shares of Shelfie (the "Shelfie Financing") to raise up to US$2,990,000 (CAD$4,025,000), through the issuance of up to 11,500,000 Shelfie common shares at a price of US$0.26 (CAD$0.35) per Shelfie common share.  Shelfie common shares issued in connection with the Shelfie Financing will be exchanged for Resulting Issuer Shares on a one for one basis, upon closing of the Acquisition, and these will be in addition to the 77,861,993 Resulting Issuer Shares to be issued to current Shelfie shareholders upon closing of the Acquisition.

The Company may pay up to an 8% cash commission in connection with the Financing and the Shelfie Financing.  Once released from escrow, the Resulting Issuer will use the proceeds of the Financing together with the proceeds from the Shelfie Financing for commercialization of the technology platform, and for general working capital purposes. 

Board of Directors and Management Changes

On completion of the Acquisition, the Company's Board of Directors and management team will be reconstituted to include three directors and management comprised of individuals listed below from the current Shelfie team. 

Bentsur Joseph, CEO, Chairman and Director

Bentsur Joseph is a serial entrepreneur with vast experience establishing successful companies and expanding them into new markets and industries. Among other roles, he has served as Chairman of the international Elad Hotels chain, Director of MARLAZ Holdings, with a portfolio of publicly traded industrial, real estate, communications, and hi-tech companies, and as CEO of DIG Ltd., which produces, and markets electric components sold throughout Israel. With several patents to his name, Bentsur Joseph is also currently the CEO and a director of A2Z Smart Technologies Corp. (TSXV: A2Z, NASDAQ: AZ), a leading vendor of advanced retail technologies.

Alan Rootenberg, CFO and Corporate Secretary

Alan Rootenberg is a chartered professional accountant who has served as the Chief Financial Officer of a number of publicly traded companies listed on the TSX, TSX Venture Exchange, OTCBB and CSE. These companies include mineral exploration, mining, technology and cannabis companies. Mr. Rootenberg has a Bachelor of Commerce degree from the University of the Witwatersrand in Johannesburg, South Africa and received his CPA designation in Ontario, Canada.

Gadi Graus – President

Mr. Graus has 30 years experience advising multinational corporations on legal, business and related aspects of their, corporate, business and M&A activities. Prior to joining Shelfie as President, Mr. Graus was a senior partner at Shibolet & Co., one of Israel's largest law firms.

Gadi Levin, Director

Gadi Levin serves as a director and CFO of various publicly listed companies in the US and Canada. He has over 15 years of experience working with public US, Canadian and multi-jurisdictional public companies. Previously, Mr. Levin also served as the Vice President of Finance and Chief Financial Officer for two Israeli investment firms specializing in private equity, hedge funds and real estate. Mr. Levin began his CPA career at the accounting firm Arthur Andersen, where he worked for nine years, specializing in U.S. listed companies involved in IPOs. Mr. Levin has a Bachelor of Commerce degree in Accounting and Information Systems from the University of the Cape Town, South Africa in 1993, and a post graduate diploma in Accounting from the University of South Africa in 1995. He received his Chartered Accountant designation in South Africa in 1998 and has an MBA from Bar Ilan University in Israel.

Daniel Bloch, Director

Daniel Bloch has a been an attorney licensed in Canada since 1998. He currently is the owner of Bloch Legal, a firm that specializes in Canadian listed company corporate legal and strategic advisory. Mr. Bloch has a Bachelor of Business Administration from York University (Toronto, Ontario, Canada) and law degree (LLB) from the University of Victoria (Victoria, British Columbia, Canada.

A copy of the Amendment Agreement will be filed and will be accessible under ECC5's profile on SEDAR (www.sedarplus.com), and in connection with the Acquisition and pursuant to the requirements of the Exchange, ECC5 will also file on SEDAR a filing statement which will contain details regarding the Acquisition, ECC5, Shelfie and the Resulting Issuer.

The Acquisition is not a Non-Arm's Length Qualifying Transaction under the policies of the Exchange and therefore is not expected to require approval of ECC5's shareholders.  ECC5 has applied for and received a waiver from sponsorship of the qualifying transaction from the Exchange.

Completion of the Acquisition is subject to a number of conditions, including Exchange acceptance, and completion of the Financing and the Shelfie Financing. Trading of ECC5's common shares will remain halted pending further filings with the Exchange.

On Behalf of the Board of Directors of ECC Ventures 5 Corp.

Doug McFaul
Director

Completion of the Acquisition is subject to a number of conditions, including, among others, Exchange acceptance and if applicable pursuant to TSXV Requirements, majority of the minority shareholder approval. Where applicable, the Acquisition cannot close until the required approvals are obtained. There can be no assurance that the Acquisition will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the disclosure document to be prepared in connection with the Acquisition, any information released or received with respect to the Qualifying Transaction, or the Acquisition may not be accurate or complete and should not be relied upon. Trading in the securities of ECC5 should be considered highly speculative.

The TSXV has in no way passed upon the merits of the proposed Acquisition and has neither approved nor disapproved the contents of this news release.

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

Forward-Looking Statements

Statements included in this announcement, including statements concerning our and Shelfie's plans, intentions, and expectations, which are not historical in nature are intended to be, and are hereby identified as, "forward‐looking statements". Forward-looking statements include, among other matters, the terms and timing of the Acquisition and the Financing and Shelfie Financing, the growth plans of Shelfie and statements concerning the Company following the Acquisition, including the composition of the Company's board of directors and management team. Forward‐looking statements may be, but are not always, identified by words including "anticipates", "believes", "intends", "estimates", "expects" and similar expressions. The Company cautions readers that forward‐looking statements, including without limitation those relating to the Company's and Shelfie's future operations and business prospects, are subject to certain risks and uncertainties (including risks that the Acquisition does not proceed, or proceed on the expected terms, geopolitical risk, regulatory, Covid-19 and exchange rate risk) that could cause actual results to differ materially from those indicated in the forward‐looking statements. There can be no assurance that any forward-looking statement will prove to be accurate or that management's assumptions underlying such statements, including assumptions concerning the Acquisition or future developments, circumstances or results will materialize. The forward-looking statements included in this news release are made as of the date of this new release and the Company does not undertake to update or revise any forward-looking information included herein, except in accordance with applicable securities laws.

SOURCE ECC Ventures 5 Corp.

please contact the Company at 778-331-8505 or email: [email protected]