RDARS Announces up to $3.5 Million Private Placement Offering of Subscription Receipts

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NORTH YORK, ON, Sept. 23, 2021 /CNW/ - RDARS Inc. ("RDARS" or the "Company") is pleased to announce it has entered into an engagement agreement with Research Capital Corporation (the "Agent") to act as sole agent and sole bookrunner on a "best efforts" basis, for a private placement of subscription receipts of the Company (the "Subscription Receipts") for gross proceeds of up to $3,500,000 (the "Offering") at a price of $0.05 per Subscription Receipt (the "Offering Price").

Each Subscription Receipt will entitle the holder thereof, without payment of any additional consideration and without further action on the part of the holder, to receive one unit of the Company (a "Unit"), upon the satisfaction of the Escrow Release Conditions (as defined herein) prior to the Termination Time (as defined below). Each Unit will consist of one common share in the capital of the Company (a "Common Share") and one Common Share purchase warrant (a "Warrant"). Each Warrant will entitle the holder to purchase one Common Share (a "Warrant Share") at an exercise price of $0.10, at any time up to 24 months following the date of satisfaction of the Escrow Release Conditions.

The net proceeds of the Offering will be used to expand the Company's existing operations, for business development and general working capital purposes.

The gross proceeds of the Subscription Receipts, less 50% of the Commission (as defined herein) and all of the Agent's expenses incurred prior to the Closing Date (the "Escrowed Proceeds"), will be delivered to the Subscription Receipt Agent (as defined herein) and deposited by the Subscription Receipt Agent in a segregated account to be held on behalf of the holders of Subscription Receipts and the Subscription Receipt Agent will retain the Escrowed Proceeds in accordance with the terms of the subscription receipt agreement (the "Subscription Receipt Agreement") to be entered into by the Company, Agent and an escrow agent to be appointed by the Company (the "Subscription Receipt Agent"). The Escrowed Proceeds (less the remaining 50% of the Commission and any outstanding costs and expenses of the Agent, which shall be released to the Agent out of the Escrowed Proceeds), together with any accrued interest thereon, will be released to the Company (or as it may direct) upon receipt by the Subscription Receipt Agent of a joint written notice (the "Escrow Release Notice") from the Company and Agent indicating the satisfaction of the Escrow Release Conditions on or before 5:00 p.m. Toronto time on the date being 180 days following the closing of the Offering (the "Release Deadline").

Subject to the terms of the Subscription Receipt Agreement, each Subscription Receipt shall be automatically converted, without any further action by the holder thereof and for no additional consideration, into one Unit on the Clearance Date (as defined herein). The escrow release conditions shall be set forth in the Subscription Receipt Agreement, and shall be as follows (collectively, the "Escrow Release Conditions"): (i) the Company obtaining a receipt from the securities regulatory authorities in each of the Qualifying Jurisdictions (as defined herein) for a Prospectus (as defined herein) qualifying the distribution of the Units underlying the Subscription Receipts; (ii) the Company obtaining conditional approval from any recognized securities exchange in Canada (the "Exchange") to list the Common Shares; (iii) the Company having delivered all such other documents as the Agent may request for a transaction of this nature in a form satisfactory to the Agent; and (iv) the Agent and Company shall have delivered a joint written notice to the Subscription Receipt Agent confirming that items (i) through (iv), inclusive, have been satisfied.

If the Escrow Release Notice shall not have been provided on or before the Release Deadline (the "Termination Time"), each holder of Subscription Receipts will forthwith receive from the Escrowed Proceeds being held by the Subscription Receipt Agent under the Subscription Receipt Agreement, the full subscription amount corresponding to such holder's Subscription Receipts, together with such holder's pro rata portion of interest earned thereon, if any, from the Closing Date to the Termination Time, less applicable withholding taxes, all in accordance with the terms of the Subscription Receipt Agreement (the "Required Refund"). Upon the occurrence of the Termination Time, the Subscription Receipts will only represent the holder's right to receive payment of such amount from the Subscription Receipt Agent. If the Escrowed Proceeds are not sufficient to satisfy the Required Refund for the full aggregate Offering Price paid for the then issued and outstanding Subscription Receipts, it shall be the Company's sole responsibility and liability to contribute such amounts as are necessary without penalty or deduction to satisfy any such shortfall.

The Company will use its best efforts to obtain a receipt for a final long form prospectus (the "Prospectus") qualifying the Units issuable pursuant to the exercise of the Subscription Receipts in such provinces of Canada in which purchasers of the Subscription Receipts reside (the "Qualifying Jurisdictions") prior to the Release Deadline. The date on which the last of the decision document and/or receipts is issued for the Prospectus is hereby referred to as the "Clearance Date".

The Agent shall have the option (the "Over-Allotment Option"), exercisable at any time prior to the Closing Date, to increase the size of the Offering by up to $1,500,000 for an aggregate of $5,000,000 in gross proceeds, if the Over-Allotment Option is fully exercised.

The Offering is expected to close on or about the week of October 25, 2021 or such other date as the Agent and the Company may agree upon (the "Closing Date"). The Offering is subject to certain conditions including, but not limited to, the Agent's satisfactory due diligence, receipt of all necessary approvals and the acceptance of the Exchange. The Common Shares and Common Shares issuable upon the exercise of the Warrants to be issued upon the exchange of the Subscription Receipts will be qualified by the Prospectus and will not be subject to any hold or restricted period.

The Agent's shall receive an aggregate cash fee equal to 8.0% of the aggregate gross proceeds of the Offering payable in cash or Subscription Receipts, or any combination of cash or Subscription Receipts at the option of the Agent, with 50% of such commission payable to the Agent at the time of closing and the remaining 50% of such commission payable to the Agent upon conversion of the Subscription Receipts. Notwithstanding the foregoing, gross proceeds raised and received from the Offering from purchases set out in a president list (the "President's List"), shall be subject to a reduced cash commission equal to 2.0%.

In addition, the Agent will receive on the Closing Date, Agent's warrants (the "Agent's Warrants") exercisable at any time prior to the date that is 24 months from the date upon which the Escrow Release Conditions are satisfied, to acquire such number of Units equal to 8.0% of the number of Subscription Receipts issued pursuant to the Offering, at an exercise price equal to the Offering Price. Notwithstanding the forgoing, gross proceeds raised from President's List shall be subject to a reduced number of Agent's Warrants equal to 2.0% of the aggregate number of Subscription Receipts issued to such purchaser.

This press release is not an offer to sell or the solicitation of an offer to buy the securities in the United States or in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to qualification or registration under the securities laws of such jurisdiction. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and such securities may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from U.S. registration requirements and applicable U.S. state securities laws.

About RDARS

RDARS is focused on the development and sale of its proprietary autonomous drone technology solution for the residential and small commercial security space. RDARS has created a fully autonomous "drone-in-a-box" and drone solution for real time alarm response, verification, and both autonomous and manual flight intervention. The drone technology is integrated into the properties security systems and is deployed autonomously upon a security breach. The drone system provides real-time data of the subject property and surroundings, and is transmitted in real time to the RDARS command & control center, in tandem with a security monitoring apparatus, that will dispatch authorities if necessary. The data can then be re-transmitted also in real time to the public safety authorities providing advance situation awareness for better preparedness and personnel safety upon approaching the property. RDARS is currently in discussions with the Federal Aviation Administration of the United States regarding the integration and standardization of the drone technology, and the Aircraft Worthiness Certifications and Drone Operational Certifications. RDARS expects to obtain regulatory approval for commercial usage partly by the end of 2021 for testing purposes and full certification by end of 2022.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain information in this news release constitutes forward-looking statements under applicable securities laws. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "expect", "potential", "believe", "intend" or the negative of these terms and similar expressions. Forward-looking statements in this news release include statements relating to: (i) the anticipated timing of the closing of the Offering and the pricing thereof, (ii) the anticipated use of proceeds, (iii) the receipt of regulatory approvals from the Exchange, regulators in the Qualifying Jurisdictions and Federal Aviation Administration, and (iv) the receipt of Aircraft Worthiness Certification and Drone Operations Certifications and the timing thereof.

Forward-looking information in this news release are based on certain assumptions and expected future events. Readers are further cautioned that the assumptions used in the preparation of such forward-looking statements, including, but not limited to, the assumption that: (i) RDARS' financial condition and development plans do not change as a result of unforeseen events, (ii) there will continue to be a demand and market opportunity for RDARS' product offerings, (iii) current and future economic conditions will neither affect the business and operations of RDARS nor RDARS' ability to capitalize on anticipated business opportunities, (iv) RDARS will complete the Offering and listing on the terms and within the timelines anticipated, (v) RDARS will receive all necessary approvals, (vi) RDARS will use the use of proceeds for the purposes set out above, and (vii) RDARS will receive Aircraft Worthiness Certification and Drone Operations Certifications on the terms and within the timelines anticipated. Although considered reasonable by management of RDARS at the time of preparation, these assumptions may prove to be imprecise and result in actual results differing materially from those anticipated, and as such, undue reliance should not be placed on forward-looking statements.

Forward-looking statements also necessarily involve known and unknown risks, including, without limitation, RDARS' inability to complete the Offering on the terms and within the timelines anticipated; RDARS inability to obtain the required regulatory approvals to complete the Offering and listing on the proposed terms and timeline; RDARS inability to receive Aircraft Worthiness Certification and Drone Operations Certifications on the terms and within the timelines anticipated; risks associated with general economic conditions; adverse industry events; marketing costs; loss of markets; future legislative and regulatory developments involving the commercial aviation and drone market; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the commercial aviation and drone industries generally; income tax and regulatory matters; the inability of RDARS to implement its business strategy; competition; currency and interest rate fluctuations; the COVID-19 pandemic nationally and globally and the response of governments to the COVID-19 pandemic in respect of RDARS' operations and other risks. Readers are cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur.

Forward-looking statements, forward-looking financial information and other metrics presented herein are not intended as guidance or projections for the periods referenced herein or any future periods, and in particular, past performance is not an indicator of future results and the results of RDARS in this press release may not be indicative of, and are not an estimate, forecast or projection of RDARS' future results. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement and reflect our expectations as of the date hereof, and thus are subject to change thereafter. RDARS disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Factors that could cause anticipated opportunities and actual results to differ materially include, but are not limited to, matters referred to above and elsewhere in RDARS' public filings and material change reports, which are and will be available on SEDAR.

SOURCE RDARS Inc.

Charles Zwebner, Director, President and Chief Executive Officer, Email: [email protected]