Company Announcements

The information contained within this Announcement is deemed by Invinity Energy Systems plc to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of UK law by virtue of the European Union (Withdrawal) Act 2018 ("MAR").

14 December 2022

Invinity Energy Systems plc

("Invinity" or the "Company")

USD $10m funding facility in place with initial draw down of $2.5m

Invinity Energy Systems plc (AIM: IES) (AQSE: IES) (OTCQX: IESVF), a leading global manufacturer of utility-grade energy storage, is pleased to announce that it has agreed terms on a convertible loan facility for up to USD $10m (the "Facility") with Riverfort Global Opportunities and YA II PN Ltd. (together the "Noteholders"), with an initial drawn amount of USD $2.5m, expected to be received by the Company on 14 December 2022, net of associated costs.

Invinity has recently closed several high-profile commercial contracts, equivalent to over 30 MWh of battery orders received so far in Q4 2022 alone. The Facility will provide additional support for Invinity's short-term working capital requirements as the Company looks to deliver on these and other contracts, whilst continuing to close further deals and develop the pipeline of contracts expected to be signed in 2023 and beyond. In addition to putting this Facility in place, Invinity also continues to actively manage its cost base as the Company progresses towards becoming operationally profitable.

The Key terms of the Facility:

·    Initial drawn amount of USD $2.5m (the "Initial Advance").

·    As part of the Facility, 2,700,038 ordinary shares in Invinity ("Ordinary Shares") are being issued to the Noteholders (the "Initial Shares"), which is to effect initial conversions relating to the Initial Advance. Further details are set out below.

·    Any amount drawn down under the Facility is convertible into Ordinary Shares at a price equal to the lower of (a) 130% of the five day VWAP immediately prior to that drawdown (the "Reference Price") (130% of the Reference Price being the "Fixed Price") and (b) 92% of the lowest daily VWAP in the 10 days prior to the Noteholder's notice of conversion (but such period can commence no earlier than 1 December 2022 and will be shortened accordingly) (the "Variable Price").

·    The Noteholders may agree (but shall not be obliged) for the Company to make further drawdowns during the three year term of the Facility, up to a maximum aggregate amount (including the Initial Advance) of USD $10m.

·    Any further advance beyond the Initial Advance would be subject to customary conditions precedents for such facilities including sufficient share authority and therefore the Company may require shareholder approval to be obtained from time to time.

·    No interest is payable on the Initial Advance and any interest rate on any further advance is to be agreed between the parties.

·    The Noteholders will also be granted a number of warrants equal to 30% of each drawdown divided by the Reference Price. The exercise price of the warrants will be 150% of the Reference Price.

o  The Reference Price for the Initial Advance is 44.9p, meaning the Noteholders will be granted 1,350,020 warrants at the time of the Initial Advance, exercisable at 67.35p each. Warrants are exercisable for up to four years.

·    Invinity will pay a commitment fee of 5% of the Initial Advance plus legal and due diligence fees which will be deducted from the Initial Advance to the extent not settled in advance.

·    Invinity has the right to repay the Initial Advance at any time with 10 working days' notice at a redemption premium of 10% of the outstanding balance, provided that:

o  The average daily VWAP in the 10 days before both the Company giving notice of prepayment and the prepayment date itself; and

o  the VWAP the day before both the notice of prepayment and the prepayment day itself,

are all below the lower of (a) the Fixed Price and (b) the price at which Invinity has issued any equity since the Initial Advance.

In the event that the Invinity is not able satisfy these conditions but the balance outstanding is equal to or less than $250,000, the Company may still repay the Initial Advance at any time with 10 working days' notice at a redemption premium of 20% of the outstanding balance.

·    Noteholders are restricted from short selling until repayment of the Facility.

·    As set out above, the Noteholders are being issued with the Initial Shares, which is equivalent to initial conversions relating to the Initial Advance. To the extent that the Noteholders sell these shares, the amount owing under the facility will be reduced by the number of Initial Shares sold multiplied by the lower of the Fixed Price and the Variable Price. The economic effect of this arrangement is identical to conversion of the debt elements of the Facility. To the extent that the Noteholders still hold Initial Shares after the Facility has been repaid in full, the shares will be sold by the Noteholders with the proceeds remitted to the Company.

In addition, the Company has agreed to issue 170,000 Ordinary Shares (the "Fee Shares") to an adviser in partial settlement of fees due.

Application has been made for the Initial Shares and the Fee Shares, totalling 2,870,038 new Ordinary Shares to be admitted to trading on AIM and the Aquis Stock Exchange and dealings are expected to occur on 20 December 2022.

Following the issue of the new Ordinary Shares the issued ordinary share capital of the Company comprises 119,007,689 Ordinary Shares of €0.01 each with one vote per share. Therefore, this figure can be used by shareholders as the denominator for the calculations by which to determine if they are required to notify their interest in, or a change to their interest in, the Company under the FCA's Disclosure and Transparency Rules.

Larry Zulch, Chief Executive Officer at Invinity said:

"I am delighted with the commercial progress made by Invinity in recent weeks. In our interim results in September 2022, we highlighted our significant order backlog and considerable near-term commercial interest. The facility we have secured supports delivering those orders while continuing to develop upcoming opportunities."

Enquiries:

Notes to Editors

Invinity Energy Systems plc (AIM: IES) (AQSE: IES) (OTCQX: IESVF) manufactures vanadium flow batteries for large-scale, high-throughput energy storage requirements of business, industry and electrical networks.

Invinity's factory-built flow batteries run continually with no degradation for over 25 years, making them suitable for the most demanding applications in renewable energy production. Energy storage systems based on Invinity's batteries are safe, reliable, and economical, and range in size from less than 250 kilowatt-hours to tens of megawatt-hours.

Invinity was created in April 2020 through the merger of two flow battery industry leaders: redT energy plc and Avalon Battery Corporation. With over 33 MWh of systems deployed to date across more than 50 sites in 15 countries, Invinity is active in all major global energy storage markets and has operations in the UK, Canada, USA, China and Australia. Invinity Energy Systems plc is listed on the AIM Market of the London Stock Exchange and on the Aquis Stock Exchange (AQSE). The Company trades in the USA on OTCQX Best Market under the symbol "IESVF".

To find out more, visit invinity.com or call Investor Relations on +44 (0)204 551 0361.