Hybrid Power receives two Spark repeat orders

Executive Summary

• Hybrid Power Solutions Inc. announced a non-brokered private placement of senior secured convertible debenture units for up to $500,000 in gross proceeds, led by Plaza Capital.
• The company received a follow-up order for two Spark power systems from a major Canadian public transit agency, validating the product in demanding infrastructure applications.
• Hybrid is reshoring the design, engineering, and assembly of its flagship Terra battery energy storage system to its domestic facility to improve quality control and supply chain efficiency.

Key Details

• Financing Structure:
  • Instrument: Non-brokered private placement of senior secured convertible debenture units.
  • Gross Proceeds: Up to $500,000.
  • Lead Investor: Plaza Capital.
  • Price: $1,000 per convertible debenture unit.
  • Closing Date: Expected on or about Aug. 18, 2025.
• Debenture Terms:
  • Principal: $1,000 per unit.
  • Interest Rate: 12.0% per annum, payable in cash monthly.
  • Maturity: 12 months from issuance.
  • Security: Collaterally secured by a general security agreement over all company property and assets.
  • Conversion Price: $0.05 per common share (subject to anti-dilution adjustments).
  • Warrants: Each unit includes 20,000 common share purchase warrants.
  • Warrant Exercise Price: $0.06 per common share (subject to anti-dilution adjustments).
  • Warrant Term: 24 months from issuance.
  • Hold Period: 4 months and 1 day statutory hold on all issued securities.
• Fees and Expenses:
  • Closing Fee: 4.0% of gross proceeds from the lead investor group.
  • Expense Reimbursement: Up to $25,000 plus taxes and disbursements for the lead investor.
• Use of Proceeds:
  • Support production for an existing order of two Terra units from a major construction company.
  • Relocate Terra manufacturing to North America to enhance supply chain efficiency and quality control.
  • Advance development of connected technology features (release set for Q4 2025).
  • Adopt advanced production and quality control processes to lower costs and improve margins.
  • Expand presence at industry trade shows and client roadshows in Canada and the US (Q4 2025).
  • Hire two additional sales representatives for key market verticals.
  • General working capital.
• Operational Updates:
  • Spark Systems: Received a repeat order of two Spark power systems from a major Canadian public transit agency following successful evaluation of an initial test unit. The systems replace gas/diesel generators for urban and maintenance environments.
  • Terra Production: Reshoring of design, engineering, and assembly of the Terra battery energy storage system to in-house facilities. This move aims to provide direct control over quality, performance, and customization, and allows for scaling into multimegawatt-hour systems.
  • Pipeline: Additional Spark units are under active quotation with the same transit agency.

Notable Quotes

• "When a major transit operator comes back with a follow-up order, it shows we're delivering performance where it matters... This is a clear signal that clean energy is not only viable but also being validated in the field by some of the most demanding infrastructure clients in the country." — Francois Byrne, CEO
• "Bringing Terra's production home is more than a manufacturing decision, it's an investment in our future capabilities... It means higher quality, faster innovation and the ability to build bigger, more powerful systems on the same design foundation." — Francois Byrne, CEO