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A2Z Smart Technologies Closes Previously Announced Offering

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A2Z Smart Technologies Corp. (AZ) announced the successful closure of a registered direct offering, raising $3.3 million at $0.35 per share. They also secured $2.4 million in a private placement. The funds will be used for business development and working capital. Certain directors and officers participated in the offerings. The company filed a prospectus with the SEC for transparency.
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The recent capital raise by A2Z Smart Technologies Corp. through a registered direct offering and a subsequent private placement is a strategic move to secure funding for the company's growth initiatives. The decision to issue common shares at a price of $0.35 per share has resulted in a substantial inflow of approximately $5.7 million. This influx of capital is earmarked for the acceleration of smart cart backlog orders and the onboarding of new clients, which indicates a proactive approach to capturing market demand and scaling operations.

However, the dilutive effect of increasing the number of shares outstanding can be a concern for current shareholders as it may lead to earnings per share reduction. Additionally, the participation of insiders, contributing $525,000, can be viewed as a vote of confidence in the company's prospects. Despite this, the related party transaction raises questions about corporate governance and the interests of minority shareholders, especially considering the reliance on exemptions from certain requirements of MI 61-101.

Within the technology sector, particularly for companies like A2Z Smart Technologies that specialize in smart cart solutions, the ability to quickly adapt and meet client demands is pivotal. The net proceeds from this capital raise could potentially enhance the company's competitive edge by allowing it to fulfill contracted orders more efficiently and attract new business. This is particularly relevant in the retail industry where smart cart technology is gaining traction for its potential to improve customer experience and operational efficiency.

On the flip side, the market's reception to the news of stock dilution and insider participation will hinge on the perceived value of these strategic moves. If the expansion leads to significant revenue growth, the short-term dilutive effects may be offset by long-term gains. Conversely, if the expansion does not yield the expected results, investor sentiment could turn negative, impacting the stock's performance.

From a legal standpoint, the issuance of common shares in both the registered direct offering and the private placement has been structured to comply with the Securities Act of 1933. The exemption from registration for the private placement indicates a targeted approach to raise funds from a select group of investors, which can be more efficient and less costly than a public offering. However, it is important for potential investors to understand the implications of such exemptions and the associated risks, including the limited market liquidity of these privately placed shares.

The involvement of company directors and officers in the offering, while legal, must be handled with transparency to maintain investor trust. The company's reliance on exemptions from MI 61-101's formal valuation and minority approval requirements could be a point of scrutiny, as it highlights the importance of robust internal policies to ensure fair treatment of all shareholders, especially in transactions involving insiders.

TEL AVIV, ISRAEL / ACCESSWIRE / April 2, 2024 / A2Z Smart Technologies Corp. (NASDAQ:AZ), ("A2Z Smart Technologies Corp." or the "Company"), today announced that it closed its previously announced registered direct offering for gross proceeds of approximately $3.3 million at a purchase price of $0.35 per share. The company issued an aggregate of 9,480,500 common shares in the registered direct offering.

In addition, the Company has entered into binding agreements with certain investors to issue 6,842,857 common shares in a private placement at a purchase price of $0.35 per share, for gross proceeds of approximately $2.4 million. The private placement is expected to close within 60 days, subject to satisfaction of closing conditions.

The Company intends to use the net proceeds primarily for continued development and expansion of its existing business, including fulfillment of contracted smart cart backlog orders and acceleration of the onboarding process for new clients, and for working capital purposes. In connection with the registered direct offering, the Company has issued certain non-U.S. residents 734,440 common shares as finders fees. These common shares and the common shares issued in the private placement have been issued pursuant to an exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, for transactions not involving a public offering and Rule 506(b) promulgated thereunder, as applicable.

Additionally, the Company advises that certain directors and officers of the Company participated in the registered direct offering and the private placement in an amount of $525,000 (the "Insider Participation"). The Insider Participation transaction is considered a "related party transaction" within the meaning of Canadian Securities Administrators Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61- 101"). The Company expects to rely on exemptions from the formal valuation and minority approval requirements in sections 5.5(a) and 5.7(1)(a) of MI 61-101 in respect of the Insider Participation.

The company has filed a prospectus with the Securities and Exchange Commission relating to the common shares issued in the registered direct offering, which can be viewed at www.sec.gov.

About A2Z Smart Technologies Corp.

A2Z Smart Technologies Corp. creates innovative solutions for complex challenges. A2Z's flagship product is the world's first proven-in-use mobile self-checkout shopping cart, Cust2Mate. With its user-friendly smart algorithm, touch screen, and other technologies, Cust2Mate streamlines the retail shopping experience by scanning purchased products and enabling in-cart payment so that customers can simply "pick & go", and bypass long cashier checkout lines. This results in a more efficient shopping experience for customers, less unused shelf-space and manpower requirements, and advanced command and control capabilities for store managers.

Forward Looking Statements

Matters discussed in this press release may contain forward-looking statements that are subject to substantial risks and uncertainties. Forward-looking statements contained in this press release may be identified by the use of words such as "anticipate," "believe," "contemplate," "could," "estimate," "expect," "intend," "seek," "may," "might," "plan," "potential," "predict," "project," "target," "aim," "should," "will" "would," or the negative of these words or other similar expressions, although not all forward-looking statements contain these words. Forward-looking statements are based on the Company's current expectations and are subject to inherent uncertainties, risks and assumptions that are difficult to predict. Further, certain forward-looking statements are based on assumptions as to future events that may not prove to be accurate. These and other risks and uncertainties are described more fully in the Company's filings on EDGAR and with the SEC. Actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements contained herein. Forward-looking statements contained in this announcement are made as of this date, and the company disclaims any intention or obligation, except to the extent required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. This press release does not constitute an offer to sell or a solicitation of an offer to sell any of the securities described herein.

Company Contact:

Gadi Graus, President
Gadi.g@a2zas.com
+972-3-3732328

Investor Contacts:

Brett Maas, Managing Principal, Hayden IR, LLC
brett@haydenir.com
(646) 536-7331

SOURCE: A2Z Smart Technologies Corp.



View the original press release on accesswire.com

FAQ

What was the gross proceeds from the registered direct offering?

The gross proceeds from the registered direct offering were approximately $3.3 million.

How many common shares were issued in the registered direct offering?

A total of 9,480,500 common shares were issued in the registered direct offering.

What is the purchase price per share in the private placement?

The purchase price per share in the private placement is $0.35.

What will the net proceeds be primarily used for?

The net proceeds will be primarily used for the development and expansion of the existing business, including fulfilling smart cart backlog orders and onboarding new clients, as well as for working capital purposes.

Who participated in the registered direct offering and private placement?

Certain directors and officers of the Company participated in the registered direct offering and private placement.

Where can the prospectus related to the common shares issued be viewed?

The prospectus related to the common shares issued can be viewed at www.sec.gov.

A2Z Smart Technologies Corp.

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About AZ

a2z technologies canada corp. provides services in the field of advanced engineering capabilities to the military/security markets in israel. the company also develops products for the civilian population; and offers fuel tank intelligent containment system, a capsule that can be placed in a fuel tank to prevent gas tank explosions. in addition, it provides maintenance services to both external and in-house complex electronic systems and products. the company is headquartered in vancouver, canada.