Hexagon Composites

Regulatory Filings • Mar 15, 2023

Hexagon Purus signs landmark long-term agreement with Hino Trucks for zero emission heavy-duty trucks in the U.S.

Hexagon Purus signs landmark long-term agreement with Hino Trucks for zero emission heavy-duty trucks in the U.S.

(Oslo, Norway, 15 March 2023) With reference to the stock exchange release on 1

March 2023, Hexagon Purus, a world leading manufacturer of zero emission

mobility and infrastructure solutions, has signed a distribution agreement with

Hino Motors Sales U.S.A., Inc. ("Hino") where Hexagon Purus will produce

complete battery electric heavy duty trucks for the U.S. market, distributed

exclusively through select qualifying dealers in Hino's network. The vehicles

will be based on Hino's XL 4x2 truck chassis and upfitted with Hexagon Purus'

proprietary zero-emission technology, including battery systems, auxiliary

modules, power modules and the vehicle-level software. The agreement foresees

the delivery of up to 10,000 trucks by 2030. These trucks will be compliant

with, amongst other, the Advanced Clean Truck regulation in California, which

requires all truck manufacturers and distributors to have an incrementally

higher zero-emission vehicle content when selling in California from 2024

onwards. The potential total value over the course of this agreement could reach

approximately USD 2.0 billion (approximately NOK 20 billion).

Hino will also be responsible for after-sales service during the lifetime of

this exclusive distribution agreement. Serial production of these electric

heavy-duty trucks will commence during the last part of 2024.

This expanded agreement replaces the already announced (11 February 2022)

cooperation between Hexagon Purus and Hino to supply battery packs for multiple

Hino truck platforms planned for serial production from 2024.

Driving Energy Transformation

"We are very proud and honored to take the co-operation with Hino to the next

level by serially producing battery electric heavy-duty trucks for distribution

in the U.S. through select qualifying dealers in Hino's network. This is a

strong validation of our technology and the capabilities as a provider of

complete zero-emission mobility solutions. With this agreement, we continue to

improve the line-of-sight for our 2025 revenue target of NOK 4-5 billion", says

Morten Holum, CEO of Hexagon Purus.

"Hino has been an important zero-emission technology development partner for

Hexagon Purus in North America for several years, and as a development partner

in Hino's "Project Z" Battery Electric Vehicle program, we are thrilled to

continue building on that strong relationship in the years to come", says Todd

Sloan, EVP of Hexagon Purus. "Approximately 12% of commercial vehicles operating

in California fall within the heavy-duty trucks classification, however, they

account for almost half of California's NOx emissions in the medium- and heavy-

duty space. Targeting the disproportionate emissions of specifically these

trucks through increasing adoption of zero-emission vehicles is crucial to

reduce emissions in California and across the whole of the U.S.".

"We are happy to get the exclusive right to distribute Hexagon Purus' zero

emission trucks through select qualifying dealers in our network of dealerships

across the U.S", says Glenn Ellis, President, Hino Trucks - A Toyota Group

Company. "Recent proposals and regulations that address the need for further

reductions in emissions in the transportation sector in the U.S. will drive the

demand for several zero-emissions classes of commercial vehicles in the many

years to come".

About the market

To reach the 1.5°C ambition set by the Paris agreement back in 2015 the

transportation sector is required to reduce emissions by 75% until 2050. In the

U.S., both the Environmental Protection Act (EPA) and California Air Resources

Board (CARB) have introduced proposals and regulations that addresses the need

for further reductions in emissions in the transportation sector. In California,

CARB has introduced a regulation for truck manufacturers (Advanced Clean Truck

standard), and more recently, proposed a new regulation for fleet owners

(Advanced Clean Fleet standard). Both regulations aim at reducing emissions and

accelerate the adoption of zero-emissions vehicles (ZEVs) in the transportation

sector in California. As part of both the Advanced Clean Truck (ACT) and the

proposed Advanced Clean Fleet (ACF) regulations, the truck manufactures and

fleet owners are required to have an incrementally higher ZEV content when

selling or operating a fleet of trucks in California from 2024 onwards. The ACT

regulation has already been adopted by five other states in the U.S.

(Massachusetts, New Jersey, New York, Oregon, and Washington) and two more

states are in the public process required to adopt (Colorado and Main).

The ACT requires amongst other that 5% of all new class 7 and 8 trucks sold in

2024 in California must be ZEV while new additions to fleets of class 7 and 8

trucks operating to and from intermodal seaports and railyards are required to

be ZEV from 2024. The ACT regulation also requires 100% of truck manufacturers'

sales in 2040 to come from ZEVs, putting an effective end to sale of internal

combustion engine trucks in California and incentivizes investments into

infrastructure and supply chain.

There are approximately 1.8 million commercial trucks operating in California

daily across a various set of classes including amongst other 219,000 class 7

and 8 trucks. According to CARB, the combined effect from the ACT and ACF

regulations will lead to approximately 0.5 million ZEVs on the road by 2035 in

California, increasing to 1.6 million in 2050.

Contacts

Mathias Meidell, Investor Relations Director, Hexagon Purus

Telephone: +47?909 82 242 | mathias.meidell@hexagonpurus.com

(mailto:mathias.meidell@hexagonpurus.com)

About Hino

Hino Trucks manufactures, sells, and services a lineup of Class 4-8 commercial

trucks in the United States. Hino Trucks is the premier heavy and medium duty

nameplate in the United States with a product lineup that offers fully connected

vehicles with low total cost of ownership, unmatched reliability and

maneuverability and the most comprehensive bundle of standard features in the

market. Headquartered in Novi, Michigan, Hino has a network of around 200

dealers nationwide committed to achieving excellence in the ultimate ownership

experience.

Learn more about Hino Trucks at http://www.hino.com or follow us on Facebook,

LinkedIn, Twitter and YouTube.

About Hexagon Purus

Hexagon Purus enables zero emission mobility for a cleaner energy future. The

company is a world leading provider of hydrogen Type 4 high-pressure cylinders

and systems, battery systems and vehicle integration solutions for fuel cell

electric and battery electric vehicles. Hexagon Purus' products are used in a

variety of applications including light, medium and heavy-duty vehicles, buses,

ground storage, distribution, refueling, maritime, rail and aerospace.

Learn more at www.hexagonpurus.com (http://www.hexagonpurus.com) and follow

@HexagonPurus on Twitter and LinkedIn

This information is subject to the disclosure requirements pursuant to Section

5-12 the Norwegian Securities Trading Act