Mr. Rodrigo Gallardo reports

XEBRA BRANDS ANNOUNCES ISSUANCE OF CEASE TRADE ORDER

Xebra Brands Ltd. does not expect to be in a position to file its annual financial statements, management's discussion and analysis, and related officer certifications for the financial year ended Feb. 28, 2025, on or prior to Aug. 29, 2025, being the date that is two months from the filing deadline of June 30, 2025. As a result of the foregoing, the company anticipates the B.C. Securities Commission, as the principal regulator of the company, will issue a failure-to-file cease trade order for its failure to file its annual filings and its unaudited interim financial statements, related management's discussion and analysis, and officer certifications for the three months ended May 31, 2025.

The BCSC had previously issued a management cease trade order against the company on July 2, 2024, in connection with the delayed filing of the annual filings. The company expects the CTO to revoke and replace the MCTO. As a result of the expected CTO, the company expects trading on the Canadian Securities Exchange to be suspended until the required documents are filed.

As previously disclosed, the annual financial filings were not filed by the applicable filing deadline due to the fact that there have been certain liquidity constraints and delays associated with recent changes of management. As announced on July 3, 2025, the company entered into a loan agreement pursuant to which the lender agreed to provide a loan of up to $110,000 to provide sufficient resources to complete the annual filings. Due to matters outside of the control of the company, the company was not advanced funds under the loan, and the loan agreement has been terminated. The company has identified several potential financing sources and expects to provide an announcement within the next couple weeks on the procurement of capital and the updated anticipated timeline to complete and file the required documents. It is expected that the CTO will remain in effect until two full business days following the receipt by the BCSC of all filings the company is required to make under B.C. securities law, including the required documents.

It is expected that the CTO will be issued under Multilateral Instrument 11-103 (Failure-To-File Cease Trade Orders In Multiple Jurisdictions) and will prohibit the trading or purchase by any person or company of any securities of the company in each jurisdiction in Canada in which the company is a reporting issuer for as long as the CTO remains in effect.

The company also announces the OTC Markets Group has informed the company that its listing has been moved from the OTCQB Market to the OTC Pink Open Market. The Pink Open Market provides brokers with a regulated platform for transparent trading.

About Xebra Brands Ltd.

Xebra Brands is a Canadian cannabis company with international reach, focused on the development and commercialization of cannabis-derived wellness products. Xebra is the first company to receive full authorization to import, cultivate, manufacture and sell cannabis (1 per cent tetrahydrocannabinol) in Mexico, and is actively expanding its Elements product line through strategic partnerships in North America.

We seek Safe Harbor.