ECC VENTURES 5 CORP. ENTERS DEFINITIVE AGREEMENT TO ACQUIRE SHELFIE-TECH LTD.

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VANCOUVER, BC, May 16, 2022 /CNW/ - ECC Ventures 5 Corp. (the "Company" or "ECC5") (TSXV: ECCV.P) is pleased to announce that, further to its news release dated February 24, 2022, it has entered into a definitive arrangement agreement (the "Arrangement Agreement") dated effective May 12, 2022, pursuant to which it will acquire (the "Acquisition"), through its newly formed 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.

The Acquisition will be completed by way of a plan of arrangement, pursuant to which, inter alia, (i) ECC5 will complete a share consolidation on a 1.5 to 1 basis (the "Consolidation"), and (ii) shareholders of Shelfie will be issued an aggregate of 87,338,348 post-Consolidation common shares of ECC5 at a deemed price of $0.42 per share, as consideration in exchange for their shares of Shelfie. Certain of the shares issued to Shelfie shareholders will be subject to escrow and resale restrictions pursuant to the policies of the Exchange.

The Company will also issue 150,000 post-Consolidation common 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 $0.42 per share. The payment of the finder's fee remains subject to Exchange acceptance.

Upon closing of the Acquisition, current securityholders of ECC5 will own 3,666,667 post-Consolidation common shares, 1,333,333 of which will be subject to escrow provisions pursuant to the policies of the Exchange, 133,333 agents options exercisable at $0.15 per post-Consolidation common share until December 16, 2026, and 376,667 stock options exercisable at $0.15 per post-Consolidation common share exercisable until one year from closing of the Acquisition, subject to the provisions of the Company's stock option plan.

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 period of incorporation to December 31, 2021 (unaudited), Shelfie had assets of US$602,392, liabilities of US$84,858, working capital of US$517,534, additional paid in capital of US$626,993, and cash received on account of shares (subscriptions receivable) of US$594,827.

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

As a condition to completing the Acquisition, the parties intend to complete a non-brokered private placement financing (the "QT Financing") of subscription receipts through Acquireco (collectively, the "Subscription Receipts"), to raise minimum aggregate gross proceeds of US$2,000,000 to a maximum of US$6,000,000, through the issuance of a minimum of 6,107,668 (maximum of 18,315,019) Subscription Receipts at a price of $0.42 per Subscription Receipt.

The proceeds of the QT 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 Consolidation. 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 common share of the issuer resulting from the Acquisition (the "Resulting Issuer") 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. The Company may pay a commission in connection with the QT Financing, in accordance with the policies of the Exchange. Once released from escrow, the Resulting Issuer will use the proceeds of the QT 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

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 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 Arrangement Agreement will be filed and will be accessible under ECC5's profile on SEDAR (www.sedar.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. Sponsorship of a qualifying transaction of a capital pool company is required by the Exchange unless an exemption from sponsorship requirement is available. ECC5 intends to apply for a waiver from sponsorship requirements. However, there is no assurance that ECC5 will obtain this waiver.

Completion of the Acquisition is subject to a number of conditions, including Exchange acceptance, and completion of the QT 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 QT 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.

Cision
Cision

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