Mr. Doug McFaul reports

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

ECC Ventures 5 Corp., further to its news releases dated May 16, 2022, and May 10, 2023, has provided an update on its proposed qualifying transaction to acquire, through its subsidiary, 1360621 B.C. Ltd. (Acquireco), all the issued and outstanding share capital of Shelfie-Tech Ltd. The acquisition will constitute a reverse takeover and the company's qualifying transaction under the policies of the TSX Venture Exchange. Upon closing, ECC Ventures 5 will change its name to Shelfie-Tech.

Shelfie is a private company incorporated on Nov. 18, 2021, pursuant to the laws of Israel. Shelfie's principal activities have been the development of an AI-powered (artificial intelligence) 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, and allowing for rapid remediation and an enhanced customer experience.

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

For more information regarding Shelfie, please visit its website.

The parties have agreed to certain amendments to the terms of the acquisition pursuant to an amendment dated Aug. 30, 2023, to the definitive arrangement agreement previously announced by ECC Ventures 5. Pursuant to the amended terms: (i) ECC Ventures 5 will, concurrently with the closing of the acquisition, complete a forward share split of its common shares on a 1.375-to-one basis; (ii) current shareholders of Shelfie will be issued an aggregate of 77,861,993 postforward split common shares of ECC Ventures 5, 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 35 cents per share, in exchange for their shares of Shelfie; and (iii) ECC Ventures 5 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 35 cents per share. Payment of the finder's fee remains subject to exchange acceptance.

Upon closing of the acquisition, current securityholders of ECC Ventures 5 will own 7,768,750 resulting issuer shares, 2.75 million of which will be subject to escrow provisions pursuant to the policies of the exchange, 275,000 agents options exercisable at seven cents per resulting issuer share until Dec. 16, 2026, and 776,875 stock options exercisable at seven cents per resulting issuer share 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 of subscription receipts through Acquireco through the issuance of up to nine million subscription receipts at a price of 26 U.S. cents (35 Canadian cents) per subscription receipt for gross proceeds of up to $2.34-million (U.S.) ($3.15-million (Canadian)).

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 to raise up to $2.99-million (U.S.) ($4,025,000 (Canadian)), through the issuance of up to 11.5 million Shelfie common shares at a price of 26 U.S. cents (35 Canadian cents) 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 a cash commission of 8 per cent 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 comprising individuals listed below from the current Shelfie team.

Bentsur Joseph, chief executive officer, chairman and director

Mr. 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, as director of Marlaz Holdings, with a portfolio of publicly traded industrial, real estate, communications and high-technology companies, and as CEO of DIG Ltd., which produces and markets electric components sold throughout Israel. With several patents to his name, Mr. Joseph is also currently the CEO and a director of A2Z Smart Technologies Corp., a leading vendor of advanced retail technologies.

Alan Rootenberg, chief financial officer and corporate secretary

Mr. Rootenberg is a chartered professional accountant who has served as the CFO of a number of publicly traded companies listed on the Toronto Stock Exchange, the TSX Venture Exchange, the OTCBB and Canadian Securities Exchange. 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 of experience advising multinational corporations on legal, business and related aspects of their corporate, business and M&A (merger and acquisition) 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

Mr. Levin serves as a director and CFO of various publicly listed companies in the United States and Canada. He has over 15 years of experience working with public U.S., Canadian and multijurisdictional public companies. Previously, Mr. Levin also served as the vice-president of finance and CFO 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 initial public offerings (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 postgraduate 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

Mr. 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, Ont., Canada) and a law degree (LLB) from the University of Victoria (Victoria, B.C., Canada.)

A copy of the amendment agreement will be filed and will be accessible under ECC Ventures 5's profile on SEDAR+, and in connection with the acquisition and pursuant to the requirements of the exchange, ECC Ventures 5 will also file on SEDAR+ a filing statement that will contain details regarding the acquisition, ECC Ventures 5, 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 ECC Ventures 5's shareholders. ECC Ventures 5 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 ECC Ventures 5's common shares will remain halted pending further filings with the exchange.

We seek Safe Harbor.