Cap Expand Partners 009581457538fd9d8ee5d73b234d2e90 Exro Announces a Public and Private Financing of up to approximately $10mm Capital Raising

Exro Technologies Inc.

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

CALGARY, Alberta, Aug. 23, 2022 (GLOBE NEWSWIRE) — Exro Technologies Inc. (TSX: EXRO, OTCQB: EXROF) (the “Company” or “Exro“), a leading clean technology company that has developed a new class of power electronics for electric motors and batteries, announces that it has commenced a marketed public offering (the “Brokered Offering“) and concurrent private placement (the “Non-Brokered Offering“, and together with the Brokered Offering, the “Financing“) of up to approximately 9.5 million units (“Units“) of the Company, at a price of $1.05 per Unit, for aggregate gross proceeds, on a combined basis, of up to approximately $10 million. The Brokered Offering will be conducted by a syndicate of agents led by National Bank Financial. The size of the Brokered Offering will be determined in the context of the market.

Each Unit shall consist of one common share of the Company (a “Share“) and one Share purchase warrant (a “Warrant“), with each Warrant exercisable to acquire one Share (a “Warrant Share“) at a price of $1.36 per Warrant Share for a period of 48 months following the issuance date of the Warrant (the “Closing Date“), provided that if at any time after the Closing Date the closing price of the Shares on the Toronto Stock Exchange (the “TSX“), or such other stock exchange where the majority of the trading volume occurs, exceeds or is equal to $2.72 per Share (on a volume-weighted adjusted basis) for a period of twenty (20) consecutive trading days, the Company may, at its sole discretion, elect to accelerate the expiry date of the Warrants to the date that is 30 calendar days after the Company issues a press release announcing that it has exercised such acceleration right.

The Company anticipates that the Warrants will be governed by a warrant indenture to be entered into between the Company and Computershare Trust Company of Canada, as warrant agent, on or before the Closing Date.

It is anticipated that the net proceeds of the Financing will be used to support the Company's growth plans through the development of key partnerships, R&D investments, manufacturing facilities, working capital and for general corporate purposes which advance Exro's mission to deliver industry disruptive next-generation power control technology that bridges the cost-performance gap and accelerates the electrification transition in mobility and energy storage.

The Brokered Offering

The Brokered Offering will be conducted on a best efforts agency basis pursuant to the terms and conditions of an agency agreement to be entered into between the Company, National Bank Financial Inc. (the “Lead Agent“) as lead agent and sole bookrunner, and other members of the agency syndicate to be formed in connection with the Brokered Offering (together with the Lead Agent, the “Agents“).

The Company has agreed to grant the Agents an option to increase the size of the Brokered Offering by up to 15% (the “Over-Allotment Option“), exercisable in whole or in part at any time for a period of 30 days after the Closing Date, solely to cover over-allotments, if any, and for market ‎stabilization purposes.

In consideration for the Agents' services with respect to the Brokered Offering, the Company has agreed to pay the Agents a cash commission of 6% of the aggregate gross proceeds of the Brokered Offering (including the Over-Allotment Option), payable on the Closing Date (and the closing date of the Over-Allotment Option, if applicable).

The Brokered Offering will be conducted in each of the provinces of Canada, other than Québec, by way of a prospectus supplement (the “Prospectus Supplement“) to the Company's short form base shelf prospectus dated December 16, 2021 (the “Base Shelf Prospectus“), and elsewhere on a private placement basis. Exro intends to file the Prospectus Supplement with the securities regulatory authorities in each of the provinces of Canada, other than Québec, which will be available on SEDAR under the Company's profile at www.sedar.com.

The Brokered Offering is expected to close on or about September 1, 2022 and is subject to customary closing conditions, including listing of the Shares and Warrant Shares on the TSX and any required approvals of the TSX and applicable securities regulatory authorities.

The Non-Brokered Offering

Concurrently with the Brokered Offering, the Company shall undertake the Non-Brokered Offering, on a non-brokered private placement basis, whereby the Company shall issue up to such number of Units as would result in the aggregate gross proceeds of the Brokered Offering and the Non-Brokered Offering, on a combined basis, not to exceed approximately $10 million. The Shares, Warrants and Warrant Shares underlying the Units sold in the Non-Brokered Offering will not be qualified for distribution by the Prospectus Supplement and will be subject to a four month hold period commencing on the date of the closing of the Non-Brokered Offering. The Non-Brokered Offering is intended to provide investors, especially Exro's long time retail supporters, an alternative opportunity to participate in the Financing in the event that they are unable to participate on the Brokered Offering. Certain members of Exro's management team plan to participate in the Non-Brokered Offering.

Certain officers and directors of the Company may participate in the Non-Brokered Offering on the same terms and conditions as all other purchasers participating in the Non-Brokered Offering. Such directors and officers are considered a “related party” of the Company, accordingly, the purchase of such securities of the Company will constitute a “related party transaction”, as such terms are defined by Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101“). The Company intends to rely on exemptions from the formal valuation and minority approval requirements of MI 61-101 under subsections 5.5(a) and 5.7(1)(a), respectively, as neither the fair market value of the contemplated securities being issued to directors and officers of the Company, nor the proceeds for such securities received by the Company will exceed 25% of the Company's market capitalization, as calculated in accordance with MI 61-101.

The Non-Brokered Offering is expected to close on or about the Closing Date and is subject to customary closing conditions, including listing of the Shares and Warrant Shares on the TSX and any required approvals of the exchange and applicable securities regulatory authorities. Exro's intention is to close the Brokered Offering and the Non-Brokered Offering concurrently on the Closing Date, however the closing of the Brokered Offering and the Non-Brokered Offering may happen on a different dates, and the Non-Brokered Offering may close in more than one tranche.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities described herein in the United States or to, or for the account or benefit of, a U.S. person. The securities described herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act“), or any securities laws of any state of the United States. Accordingly, the securities may not be offered or sold within the United States or to, or for the account or benefit of, a U.S. person except in transactions exempt from the registration requirements of the U.S. Securities Act and applicable securities laws of any state of the United States. United States and U.S. person are as defined in Regulation S under the U.S. Securities Act.

ABOUT EXRO TECHNOLOGIES INC.

Exro is a clean technology company pioneering intelligent control solutions in power electronics to help solve the most challenging problems in electrification. Exro has developed a new class of control technology that expands the capabilities of electric motors, generators, and batteries. Exro enables the application to achieve more with less energy consumed.

Exro's advanced motor control technology, the Coil Driverᵀᴹ, expands the capabilities of electric powertrains by enabling intelligent optimization for efficient energy consumption. Exro is working with many partners from all over the world to bring their technology to the electric mobility industries and beyond.

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

Visit us on social media @exrotech.

CONTACT INFORMATION

Investor inquiries: ir@exro.com

Canada investors: Jake Bouma at 604-317-3936

United States investors: Vic Allgeier at 646-841-4220

Media inquiries: media@exro.com

Cautionary Statement Regarding Forward-Looking Information

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 by the use of 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”. These forward-looking statements include, but are not limited to, statements relating to the filing of the Prospectus Supplement, the timing and ‎completion of the Brokered Offering and the Non-Brokered Offering, the satisfaction and timing of the receipt of required stock exchange ‎approvals and other conditions to closing of the Brokered Offering and the Non-Brokered Offering and the intended use of the net proceeds of the ‎Financing. Forward looking statements involve risks, uncertainties and other factors that could cause actual results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements, including, among others: the risk that the Company may not file the Prospectus Supplement to qualify the distribution of the Units issued pursuant to the Brokered Offering; the risk that the Company may not complete the Brokered Offering or the Non-Brokered Offering; the risk that the Brokered Offering or the Non-Brokered Offering may not be completed on the anticipated terms; the risk that required regulatory approvals for the Brokered Offering and the Non-Brokered Offering are not obtained; the state of the financial markets for the Company's securities; recent market volatility and potentially negative capital raising conditions resulting from the continued COVID-19 pandemic and risks relating to the extent and duration of such pandemic and its impact on global markets; the conflict in Eastern Europe; the Company's ability to raise the necessary capital or to be fully able to implement its business strategies; other risk factors disclosed under the heading “Risk Factors” in the Base Shelf Prospectus and elsewhere in the Company's filings with Canadian securities regulators; and other risks and factors that the Company is unaware of at this time. 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, 2021 and the six month period ended June 30, 2022, and financial statements and related MD&A for the financial year ended December 31, 2021 and the six month period ended June 30, 2022, filed with the securities regulatory authorities in certain provinces of Canada and available at www.sedar.com. 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 which 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, The Nasdaq Stock Market LLC nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this press release.

Cap Expand Partners Exro-Technologies-Inc- Exro Announces a Public and Private Financing of up to approximately $10mm Capital Raising

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