Mr. Rodrigo Gallardo reports

XEBRA BRANDS ANNOUNCES SHARE CONSOLIDATION AND PROVIDES UPDATE ON MCTO

Xebra Brands Ltd. intends to consolidate its issued and outstanding common shares on the basis of 10 preconsolidation common shares for one postconsolidation common share. As of the date hereof, there are 84,144,855 common shares issued and outstanding and on a postconsolidation basis, the company shall have approximately 8,414,486 common shares issued and outstanding.

No fractional common shares will be issued as a result of the consolidation. Any fractional interest in common shares that is less than 0.5 of a common share resulting from the consolidation will be rounded down to the nearest whole common share, and any fractional interest in common shares that is equal to or greater than 0.5 of a common share will be rounded up to the nearest whole common share. The common shares will be expected to begin trading on a consolidated basis with a new Cusip number on or around Aug. 28, 2025, subject to regulatory approvals, including the approval of the Canadian Securities Exchange. Pursuant to the Business Corporations Act (British Columbia) and the articles of the company, shareholder approval of the consolidation is not required.

Shareholders of the company who hold their shares through a securities broker or dealer, bank, or trust company will not be required to take any measures with respect to the consolidation. Xebra's transfer agent, Computershare Investor Services Inc., will mail a letter of transmittal to all registered shareholders of Xebra that will contain instructions for exchanging their preconsolidation common shares for postconsolidation common shares. Registered shareholders will be required to return their certificates representing preconsolidation common shares and a completed letter of transmittal to Computershare. Any registered shareholder who submits a duly completed letter of transmittal to Computershare along with a preconsolidation share certificate will receive in return a postconsolidation share certificate or direct registration system advice. Xebra's outstanding warrants and options will be adjusted on the same basis (one for 10) as the common shares, with proportionate adjustments being made to exercise prices.

The company is also providing an update to its previously disclosed management cease trade order, announced on July 2, 2025, in respect of the audited annual financial statements and corresponding management's discussion and analysis for the year ended Feb. 28, 2025, including the chief executive officer and chief financial officer certifications that were not filed by the required filing deadline of June 30, 2025.

As previously disclosed, the annual financial filings were not filed by the filing deadline because there have been certain liquidity constraints and delays associated with recent changes of management.

The company is working expeditiously to address the liquidity constraints and implement management changes necessary to complete the annual financial filings and expects to file them by Aug. 29, 2025. The company will provide updates as further information regarding the annual financial filings becomes available.

Until the annual financial filings are completed, the MCTO will remain in effect. The company will continue to issue biweekly default status reports in accordance with National Policy 12-203 (Management Cease Trade Orders) and intends to comply with the alternative information guidelines for as long as it remains in default of the filing requirements. The company confirms that, as of the date of this news release, there have been no material business developments or other material information regarding its affairs that has not been generally disclosed.

We seek Safe Harbor.