Spectra7 Announces Completion of Amendment and Extension of Convertible Debentures

SAN JOSE, Calif.–(BUSINESS WIRE)–(TSX-V:SEV) Spectra7 Microsystems Inc. (“Spectra7” or the “Company”), a leading provider of high-performance analog semiconductor products for broadband connectivity markets, today announces that it has received the consent, by extraordinary resolutions of the holders, to amend certain terms of its existing 7% unsecured convertible debentures (the “Debentures”) pursuant to a first supplemental debenture indenture. All dollar amounts referenced in this release are in Canadian dollars.

Pursuant to the first supplemental debenture indenture, the maturity date of the Debentures has been extended 18 months from January 9, 2021 to July 9, 2022, and the conversion price of the principal amount of the Debentures has been reduced from $0.35 per common share to $0.05 per common share until January 9, 2022 and then $0.10 per share until July 9, 2022. In consideration for the amendments, the Company has provided a 10% increase to the outstanding principal obligations of the Debentures with such increased amount not being convertible into common shares. The interest rate on the Debentures is not being amended.

The first supplemental debenture indenture also amends the Debentures to allow the Company to conduct patent sales or patent secured debt financings without approval of the debentureholders provided that the Company uses 50% of the net proceeds received from such sales or debt financings towards the pro rata repayment of the principal amount of the Debentures and accrued and unpaid interest on such amount with the remaining 50% applied to working capital of the Company. Finally, the Debentures have been amended to include a make-whole interest payment to the maturity date for Debentures that are converted prior to maturity.

ABOUT SPECTRA7 MICROSYSTEMS INC.

Spectra7 Microsystems Inc. is a high-performance analog semiconductor company delivering unprecedented bandwidth, speed and resolution to enable disruptive industrial design for leading electronics manufacturers in virtual reality, augmented reality, mixed reality, data centers and other connectivity markets. Spectra7 is based in San Jose, California with a design center in Cork, Ireland and technical support location in Dongguan, China. For more information, please visit www.spectra7.com.

Neither the TSX Venture Exchange nor its regulation services provided (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

CAUTIONARY NOTES

Certain statements contained in this press release constitute “forward-looking statements”. All statements other than statements of historical fact contained in this press release, including, without limitation, those regarding the Company’s outlook, strategy, plans, objectives, goals and targets, and any statements preceded by, followed by or that include the words “believe”, “expect”, “aim”, “intend”, “plan”, “continue”, “will”, “may”, “would”, “anticipate”, “estimate”, “forecast”, “predict”, “project”, “seek”, “should” or similar expressions or the negative thereof, are forward-looking statements. These statements are not historical facts but instead represent only the Company’s expectations, estimates and projections regarding future events. These statements are not guarantees of future performance and involve assumptions, risks and uncertainties that are difficult to predict. Therefore, actual results may differ materially from what is expressed, implied or forecasted in such forward-looking statements. Additional factors that could cause actual results, performance or achievements to differ materially include, but are not limited to the risk factors discussed in the Company’s Annual Information Form and annual MD&A for the year ended December 31, 2019. Management provides forward-looking statements because it believes they provide useful information to investors when considering their investment objectives and cautions investors not to place undue reliance on forward-looking information. Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company. These forward-looking statements are made as of the date of this press release and the Company assumes no obligation to update or revise them to reflect subsequent information, events or circumstances or otherwise, except as required by law.

Contacts

Spectra7 Microsystems Inc.

James Bergeron

Investor Relations

289-512-0541

ir@spectra7.com

Spectra7 Microsystems Inc.

Dave Mier

Chief Financial Officer

925-858-7011

pr@spectra7.com