SPARC AI Announces Private Placement

(TheNewswire)

TORONTO, Canada – TheNewswire -September 17, 2025 — SPARC AI Inc. (the “Company”) SPAI (OTCQB: SPAIF) (Frankfurt: 5OV0) is pleased to announce it will
conduct a non-brokered private placement (the “Offering”) of up to1,428,570 units (each, a “Unit”), at a price of $0.21 per Unit, forgross proceeds of up to $300,000.

Each Unit will consist of one common share of theCompany and one common share purchase warrant (each, a “Warrant”).  EachWarrant will entitle the holder to purchase one common share of theCompany at a price of $0.28 at any time on or before that date whichis thirty-six months after the closing date of the Offering.  If theclosing price of the common shares of the Company on the CanadianSecurities Exchange exceeds $1.00 for a period of ten consecutivetrading days, the Company may elect to accelerate the expiry date ofthe Warrants.

The net proceeds raised from the Offering will be usedto advance development of the Company’s Target Acquisition System,including the addition of new features and capabilities for defenseapplications, for product marketing, tradeshows and demonstrations,and for working capital and general corporate purposes.

Subject to compliance with applicable regulatoryrequirements and in accordance with National Instrument 45-106 –ProspectusExemptions (“NI 45-106”),952,380 Units in the Offering will be made available to purchasersresident in Canada, except Quebec, pursuant to the listed issuerfinancing exemption under Part 5A of NI- 45-106 (the “Listed Issuer FinancingExemption”), with the balance of 476,190 Unitsmade available to purchasers resident in all eligible jurisdictionspursuant to the accredited investor exemption (the “Accredited Investor Exemption”) under Section 2.3 of NI 45-106.  The securities offeredunder the Listed Issuer Financing Exemption will not be subject to ahold period in accordance with applicable Canadian securities laws. The securities offered under the Accredited Investor Exemption willbe subject to a hold period for four-months-and-one-day after theclosing date of the Offering.

There is an offering document related to the Offeringthat can be accessed under the Company’s profile on SEDAR+ atwww.sedarplus.ca and on the Company’s website at: www.sparcai.co. Prospective investors should read this offering document beforemaking an investment decision.  The Company will pay finders’ feesto eligible parties who have assisted in introducing subscribers tothe Offering.  Closing of the Offering remains subject to applicableregulatory approvals.

About SPARC AI Inc.

SPARC AI designs and develops high tech solutions forGPS denied environments that enhance perception and awareness.  TheCompany has developed an innovative Target Acquisition System andAutonomous Flight solution for drones without requiring GPS,satellite, lidar, radar, image recognition or any other complexhardware or software solution

For further information
contact:

Anoosh Manzoori, Chief Executive Officer

SPARC AI Inc.

E-mail: anoosh@sparcai.net

Tel: +61.3.9666338

Cautionary Statement
Regarding Forward-Looking Statements

This news release contains “forward-looking
statements” or “forward-looking information” (collectively,
“forward-looking statements”) within the meaning of applicable
securities legislation. All statements, other than statements of
historical fact, are forward-looking statements and are based on
expectations, estimates and projections as of the date of this news
release. Forward-looking statements include, but are not limited to,
statements regarding: the expected timing for completion of the
Offering and the intended use of proceeds.

Forward-looking statements are subject to a variety of
known and unknown risks, uncertainties and other factors that could
cause actual events or results to differ from those expressed or
implied by forward-looking statements contained herein. There can be
no assurance that such statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Certain important factors that could
cause actual results, performance or achievements to differ materially
from those in the forward-looking statements are highlighted in the
“Risks and Uncertainties” in the Company’s management discussion
and analysis.

Forward-looking statements are based upon a number of
estimates and assumptions that, while considered reasonable by the
Company at this time, are inherently subject to significant business,
economic and competitive uncertainties and contingencies that may
cause the Company’s actual financial results, performance, or
achievements to be materially different from those expressed or
implied herein. Some of the material factors or assumptions used to
develop forward-looking statements include, without limitation: the
failure to complete the Offering; reliance on key management and other
personnel; potential downturns in economic conditions; competition
from others; market factors, including future demand products
developed by the Company; the policies and actions of foreign
governments, which could impact the ability of the Company to
successfully market its products; the Company’s expectations in
connection with the development of the Target Acquisition System; the
effectiveness of the Target Acquisition System; changes in national
and local government legislation, taxation, controls or regulations
and/or changes in the administration or laws, policies and practices;
the impact of general business and economic conditions; currency exchange
rates; and the impact of inflation.

The forward-looking statements contained in this news
release are expressly qualified by this cautionary statement. Any
forward-looking statements and the assumptions made with respect
thereto are made as of the date of this news release and, accordingly,
are subject to change after such date. The Company disclaims any
obligation to update any forward-looking statements, whether as a
result of new information, future events or otherwise, except as may
be required by applicable securities laws. There can be no assurance
that forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not place
undue reliance on forward-looking statements.

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