An anonymous director reports

XTRACT ONE ANNOUNCES MARKETED PUBLIC OFFERING OF UNITS AND CONCURRENT INVESTMENT BY STRATEGIC PARTNER

Xtract One Technologies Inc. has entered into an engagement letter with Eight Capital, pursuant to which the agent has agreed to conduct a public offering of units on a commercially reasonable best effort marketed basis. Each unit shall consist of one common share in the capital of the company and one common share purchase warrant. The number of units to be sold and amount of proceeds to be raised under the offering will be determined in the context of the market. There can be no assurance as to whether or when the offering may be completed or as to the actual size or terms of the offering.

The company has granted the agent an option to increase the size of the offering by up to 15 per cent, exercisable in whole or in part at any time, at the sole discretion of the agent, to acquire: (i) additional units; (ii) additional shares; or (iii) additional warrants, or a combination thereof, for a period of 30 days from and including the closing date (as defined herein).

The units will be offered by way of a prospectus supplement to the company's short form base shelf prospectus dated Feb. 6, 2024, which prospectus supplement will be filed with the securities commissions and other similar regulatory authorities in each of the provinces and territories of Canada, except Quebec. The offering is expected to close on or about April 24, 2024, and is subject to certain conditions, including, but not limited to, the receipt of all necessary regulatory and stock exchange approvals, including the approval of the Toronto Stock Exchange and the applicable securities regulatory authorities.

Fees, in cash or securities of the company or a combination thereof, may be payable to the agent in accordance with the policies of the Toronto Stock Exchange.

In addition to and concurrent with the offering, the company intends to complete a private placement offering of units to MSG Sports Ventures LLC, a wholly owned subsidiary of Madison Square Garden Sports Corp., to permit MSG Sports to maintain its pro rata interest in the outstanding securities of the company. The number of units to be sold and amount of proceeds to be raised under the concurrent private placement will be based on the size of the offering and whether or the extent to which the overallotment option is exercised by the agent. No finders' fees or commissions will be paid in connection with the concurrent private placement.

Closing of the concurrent private placement is expected to occur concurrently with the closing of the offering and is subject to certain conditions, including, but not limited to, the concurrent completion of the offering and the receipt of all necessary regulatory approvals, including the approval of the TSX. Closing of the offering is not conditional on the closing of the concurrent private placement.

The concurrent private placement with MSG Sports will constitute a related-party transaction within the meaning of Multilateral Instrument 61-101 (Protection of Minority Security Holders in Special Transactions). The company is relying on the exemptions from the valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101 as the fair market value of the participation in the concurrent private placement by MSG Sports will not exceed 25 per cent of the market capitalization of the company in accordance with MI 61-101.

Xtract One intends to use the proceeds of the offering and the concurrent private placement for working capital and general corporate purposes.

Prospective investors should read the shelf prospectus, the prospectus supplement, once filed, and the documents incorporated by reference therein before making an investment decision. Copies of the shelf prospectus and the prospectus supplement, following filing thereof, are, or will be, as applicable, available on the company's SEDAR+ profile.

About Xtract One Technologies Inc.

Xtract One is a leading technology-driven threat detection and security solution, leveraging artificial intelligence to provide seamless and secure patron access control experiences. The company makes unobtrusive threat detection systems that enable venue building operators to prioritize and deliver improved patron experiences while providing unprecedented safety. Xtract One's innovative Gateway product enables companies to covertly screen for weapons at points of entry without disrupting the flow of traffic. Its artificial-intelligence-based software allows venue and building operators to identify weapons and other threats inside and outside of facilities and receive valuable intelligence for optimizing operations.

We seek Safe Harbor.