An anonymous director reports

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

Xtract One Technologies Inc. has priced its previously announced public offering. The offering is being conducted by Eight Capital, as lead agent and sole bookrunner, and Echelon Wealth Partners Inc. (together with Eight Capital, the agents), pursuant to which the agents have agreed to conduct the offering on a commercially reasonable best efforts basis.

Pursuant to the offering, the company intends to issue units at a price of 51 cents per unit for gross proceeds of up to $5-million. Each unit will consist of one common share of the company and one common share purchase warrant. Each warrant will be exercisable into one common share for a period of 36 months from the closing of the offering at an exercise price of 64 cents, subject to adjustment in certain events. 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.

The company has granted the agents 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 agents, to acquire either: (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, to be filed in all provinces and territories of Canada, except Quebec.

In connection with the offering, the company has agreed: (i) to pay to the agents a cash commission equal to 7.0 per cent of the aggregate gross proceeds of the offering (including any gross proceeds raised on exercise of the overallotment option), other than in respect of gross proceeds raised from purchasers on the company's president's list, for which the agents will receive a cash commission equal to 3.5 per cent; and (ii) to issue to the agents an aggregate number of agents' warrants equal to 7.0 per cent of the aggregate number of units issued pursuant to the offering (including any units issued on exercise of the overallotment option), other than in respect of units sold to purchasers on the company's president's list, for which the agents will receive agents' warrants equal to 3.5 per cent. Each agent's warrant will be exercisable into one common share (an agent's warrant share) at an exercise price of 51 cents for a period of 24 months from the closing date.

The company will apply to list the common shares, warrant shares, agents' warrant shares and warrants issuable pursuant to the offering on the Toronto Stock Exchange. Copies of the prospectus, following filing thereof, can be obtained on the company's SEDAR+ profile and from the agents by contacting ecm@viiicapital.com. The prospectus contains important detailed information about the company and the proposed offering. Prospective investors should read the prospectus and the other documents the company has filed on SEDAR+ before making an investment decision.

Concurrent private placement

In addition to and concurrent with the offering, the company has agreed to issue and sell units (the private placement (PP) units), on a private placement basis (the concurrent private placement), to MSG Sports Ventures LLC, a wholly owned subsidiary of Madison Square Garden Sports Corp., in order to permit MSG Sports to maintain its pro rata interest in the outstanding securities of the company. The final number of PP units to be sold and amount of proceeds to be raised under the concurrent private placement will be equal to approximately 19.18 per cent of the units sold under the offering, as well as additional units and/or shares (if any) pursuant to the overallotment option, if any. 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.

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

About Xtract One Technologies Inc.

Xtract One Technologies is a leading technology-driven threat detection and security solution leveraging artificial intelligence (AI) 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 AI-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.