Exro Provides Update on Facility Milestones

Rhea-AI Summary

Exro Technologies (TSX: EXRO) has provided an update regarding its previously announced US$30 million credit facility. The company has successfully amended the indenture governing its $15 million Convertible Debentures, securing a first priority security interest for the facility lender. The Convertible Debentures now hold a second priority position, ranking equally with existing secured notes totaling US$70.8 million.

The amendment includes a 120-day standstill period for debenture holders' enforcement rights and was approved by over 66 2/3% of debenture holders. Additionally, Exro has received an extension from July 15 to July 31, 2025, for demonstrating engagement with three strategic partners as part of its ongoing strategic review process.

Positive

• Successfully amended debenture security arrangements to support US$30M credit facility
• Secured approval from over 66 2/3% of debenture holders for the amendments
• Obtained extension for strategic partner engagement milestone to July 31, 2025
• Strategic review process reportedly progressing positively

Negative

• Significant debt obligations with US$70.8M in secured notes plus $15M in convertible debentures
• Need for 120-day standstill period suggests potential financial stress
• Required extension for strategic partner milestone indicates possible delays in process

CALGARY, AB, July 16, 2025 /PRNewswire/ - Exro Technologies Inc. (TSX: EXRO) ("Exro" or the "Company"), a leading clean technology company specializing in power control solutions for electric vehicles and energy storage, provides a further update on the satisfaction of the near-term strategic milestones established in connection with the company's US$30 million credit facility announced on May 16, 2025 (the "Facility").

Postponement of Debenture Security

As the Company announced in its May 16, 2025 news release, advances under the Facility require Exro to meet various milestones, one of which was either (1) the postponement of security from a requisite majority of the Company's $15 million of debentures issued pursuant to an indenture dated December 30, 2022 (the "Convertible Debentures"), or (2) the redemption of the Convertible Debentures for Exro shares.

The December 30, 2022 indenture governing the Convertible Debentures (the "Indenture") has been amended to provide that the lender under the Facility has a first priority security interest on substantially all of the assets of the Company, and the Convertible Debentures now have a second priority security position, ranking pari passu with previously issued secured notes of the Company in the aggregate amount of US $70,832,830.  In addition, the Indenture was amended to include a 120 day standstill period in respect of the enforcement of certain rights by the holders of the Convertible Debentures on the occurrence of an event of default under the Indenture. The amendments to the Indenture were approved by an extraordinary resolution of over 66 2/3% of the principal outstanding amount of the Convertible Debentures and are contained in an Amended and Restated Indenture dated July 11, 2025, a copy of which has been filed under the Company's profile at www.sedar.com.

Exro thanks the Convertible Debenture holders who supported the Company in this initiative.

Strategic Review

The strategic review process described in the Company's May 16, 2025 press release remains active and is progressing positively. The Company has received an extension of the Facility milestone of demonstrating active engagement with three credible strategic partners from July 15 to July 31, 2025.

ABOUT EXRO TECHNOLOGIES INC.

Exro Technologies Inc., now expanded through the strategic acquisition of SEA Electric, is a leading clean technology company that has developed new-generation power control electronics. Its innovative suite of solutions, including Coil Driver™, Cell Driver™, and SEA-Drive®, expand the capabilities of electric motors and batteries and offer OEMs a comprehensive e-propulsion solution with unmatched performance and efficiency. Exro is reshaping global energy consumption, accelerating adoption towards a circular electrified economy by delivering more with less – minimum energy for maximum results. 

For more information visit our website at www.exro.com.

To view our Corporate Presentation visit us at www.exro.com/investors

Visit us on social media @exrotech.

CAUTIONARY STATEMENT REGARDING FORWARD LOOKING STATEMENTS

This news release contains forward-looking statements and forward-looking information (together, "forward-looking statements") within the meaning of applicable securities laws. All statements, other than statements of historical facts, are forward-looking statements. Generally, forward-looking statements can be identified using terminology such as "plans", "expects", "estimates", "intends", "anticipates", "believes" or variations of such words, or statements that certain actions, events or results "may", "could", "would", "might", "will be taken", "occur" or "be achieved". Forward looking statements involve risks, uncertainties and other factors disclosed under the heading "Risk Factors" and elsewhere in the Company's filings with Canadian securities regulators, that could cause actual results, performance, prospects, and opportunities to differ materially from those expressed or implied by such forward-looking statements. Although the Company believes that the assumptions and factors used in preparing these forward-looking statements are reasonable based upon the information currently available to management as of the date hereof, actual results and developments may differ materially from those contemplated by these statements. Readers are therefore cautioned not to place undue reliance on these statements, which only apply as of the date of this news release, and no assurance can be given that such events will occur in the disclosed times frames or at all. Except where required by applicable law, the Company disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

This information is qualified in its entirety by cautionary statements and risk factor disclosure contained in filings made by the Company with the Canadian securities regulators, including the Company's annual information form for the financial year ended December 31, 2024, and financial statements and related MD&A for the financial year ended December 31, 2024, filed with the securities regulatory authorities in certain provinces of Canada and available at www.sedarplus.ca. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties, and factors that could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated, or intended. The Company does not intend, and does not assume any obligation, to update this forward-looking information except as otherwise required by applicable law.

Neither the Toronto Stock Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this press release.

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SOURCE Exro Technologies Inc.

FAQ

What changes did Exro Technologies (EXROF) make to its Convertible Debentures in July 2025?

Exro amended the indenture to give the US$30M facility lender first priority security interest, while the Convertible Debentures were moved to second priority position, along with adding a 120-day standstill period for enforcement rights.

How much debt does Exro Technologies currently have in 2025?

Exro has US$70.8 million in secured notes, $15 million in Convertible Debentures, and a new US$30 million credit facility.

What is the deadline for Exro's strategic partner engagement milestone?

The deadline has been extended from July 15 to July 31, 2025, by which time Exro must demonstrate active engagement with three credible strategic partners.

What percentage of debenture holders approved Exro's security amendments?

The amendments were approved by an extraordinary resolution of over 66 2/3% of the principal outstanding amount of the Convertible Debentures.

When was Exro's US$30 million credit facility announced?

Exro announced the US$30 million credit facility on May 16, 2025.