Mr. Samuel Cochrane reports

AUTOCANADA COMPLETES SALE OF KIA OF LINCOLNWOOD AND ADVANCES U.S. EXIT STRATEGY

AutoCanada Inc. has completed the sale of Kia of Lincolnwood, in Lincolnwood, Ill. This dealership is part of the U.S. dealerships reclassified as discontinued operations at year-end 2024.

In the 12 months ended Dec. 31, 2025, Kia of Lincolnwood generated sales of approximately $53.0-million (2024 -- $58.0-million) and incurred a net loss of $1.6-million (2024 -- net loss of $2.0-million).

AutoCanada received approximately $13.4-million in cash on the sale, comprising $7.1-million for goodwill and fixed assets, excluding inventory and net working capital, and $6.3-million for real estate. Net proceeds will be directed toward reducing the outstanding balance of the company's revolving credit facility.

The disposition of Kia of Lincolnwood represents continued progress in the company's previously announced plan to exit its U.S. operations segment and strengthen its balance sheet. Since the reclassification of the U.S. segment as discontinued operations at the end of 2024, the company has generated total gross proceeds net of working capital of approximately $62.4-million from U.S. asset sales and continues to expect total gross proceeds at the high end of its previously communicated range of $115-million to $130-million. The U.S. dealerships had a net loss from discontinued operations of $103.4-million in 2024.

In connection with this process, AutoCanada has received consent from its lending syndicate to amend the total financed debt to bank EBITDA (earnings before interest, taxes, depreciation and amortization) covenant under its credit facility. The maximum permitted ratio has been increased from 4.0 times to 4.5 times through June 30, 2026, providing the company with additional financial flexibility as it continues to execute on the divestiture of its remaining U.S. dealerships. This amendment reflects the continuing support of the company's lending syndicate as the company advances its strategic initiatives.

About AutoCanada Inc.

AutoCanada's Canadian segment, which is classified as continuing operations, consists of 64 franchised dealerships across Canada, representing 23 automotive brands in eight provinces. AutoCanada currently sells Acura, Audi, BMW, Buick, Cadillac, Chevrolet, Chrysler, Dodge, Ford, GMC, Honda, Hyundai, Infiniti, Jeep, Kia, Mazda, Mercedes-Benz, MINI, Nissan, Porsche, Ram, Subaru and Volkswagen vehicles. In 2025, its Canadian dealerships sold approximately 71,000 new and used retail vehicles.

AutoCanada's Canadian segment also operates 33 collision centres, supported by 26 original equipment manufacturer (OEM) certifications spanning 37 vehicle brands.

AutoCanada's U.S. segment is classified as discontinued operations as the company progresses the sale of its U.S. dealership portfolio. This portfolio consists of 11 franchised dealerships representing eight brands in Illinois, and in 2025 sold approximately 8,000 new and used retail vehicles.

We seek Safe Harbor.