Mr. Zafer Qureshi reports

BANXA HOLDINGS INC. ENTERS INTO DEFINITIVE AGREEMENT TO BE ACQUIRED BY HONG KONG-LISTED FINTECH LEADER

Banxa Holdings Inc. has entered into an arrangement agreement with OSL Group Ltd., a Hong Kong Stock Exchange-listed public company and a global leader in the digital asset industry, and OSL BNXA Acquisition Inc. (the purchaser), a private company existing under the laws of the Province of British Columbia and a wholly owned subsidiary of the parent formed to carry out the transaction (as defined below), pursuant to which the purchaser will acquire all of the issued and outstanding common shares in the capital of the company for cash consideration of $1.55 per share. The consideration represents an 80.2 per cent and 138.5 per cent premium to the 30-day and 60-day average trading price, respectively, of the shares ending on June 26, 2025. OSL and the purchaser are each arm's length to the company, and the transaction is an arm's-length transaction within the meaning of the policies of the TSX Venture Exchange.

• Banxa shareholders to receive cash payment of $1.55 per Banxa share, representing an 80.2-per-cent and 138.5-per-cent premium to the 30-day and 60-day average trading price, respectively, of the Banxa shares ending on June 26, 2025.
• The board has unanimously determined that the transaction is in the best interests of the company and has recommended that securityholders vote in favour of the transaction.
• Shareholders holding approximately 33 per cent of the Banxa shares have agreed to support the transaction.

"We are delighted to be combining Banxa and OSL's aligned vision of delivering the benefits of global crypto payments infrastructure and crypto exchange services to enterprises and users around the world. We are excited to be joining the OSL team to accelerate the growth of our platform at a global scale," said Zafer Qureshi, executive director and co-chief executive officer of Banxa. "Today, the board of directors of Banxa is proud to take this step forward -- one that reflects our confidence in the future and our commitment to deliver value to all our stakeholders."

Strategic rationale

The arrangement agreement was approved unanimously by the board, which also recommended that holders of shares vote in favour of the transaction at the meeting (as defined below).

In making its determination to unanimously recommend approval of the transaction, the board considered the following factors, among other things:

• Compelling value and immediate liquidity -- The all-cash consideration provides shareholders with immediate value and liquidity. The consideration represents an 80.2-per-cent and 138.5-per-cent premium to the 30-day and 60-day average trading price, respectively, of the shares ending on June 26, 2025.
• Fairness opinion -- The board received an oral fairness opinion from Evans & Evans Inc., which concluded that, based upon and subject to the assumptions made, procedures followed, matters considered and the limitations and qualifications set out therein, the consideration to be received by the Banxa shareholders pursuant to the transaction is fair, from a financial point of view, to such shareholders. A written copy of the fairness opinion will be included in the materials circulated to securityholders of the company in connection with the meeting.
• Support for the transaction -- Certain securityholders, including each of the directors and officers of the company, have entered into voting support agreements, pursuant to which they have agreed to, among other things, vote their shares, representing an aggregate of 14,962,950 shares (or approximately 33 per cent of the total issued and outstanding shares), in favour of the transaction at the meeting.
• Arrangement agreement and fiduciary out -- The arrangement agreement is the result of a comprehensive negotiation process that resulted in terms and conditions that are reasonable in the judgment of the board, including a customary fiduciary out that will enable the company to enter into a superior proposal in certain circumstances.
• Termination fee -- The termination fee payable by the company if the arrangement agreement is terminated, being $4.25-million, is payable only in customary and limited circumstances.
• Securityholder and court approval -- The transaction must be approved by at least two-thirds (66.67 per cent) of the votes cast by shareholders, but also by: (a) at least two-thirds (66.67 per cent) of the votes cast by shareholders and the holders of share purchase warrants and stock options of the company, present in person or represented by proxy at the meeting, voting together as members of a single class; and (b) if required, a majority of the minority vote of shareholders conducted in accordance with Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions (MI 61-101). The transaction will also be subject to approval by the British Columbia Supreme Court.

Transaction details

Pursuant to the terms of the arrangement agreement, the purchaser will acquire all of the shares, other than any shares held by shareholders who validly exercise dissent rights in accordance with the plan of arrangement (as defined below), for a purchase price of $1.55 per share, payable in cash.

The transaction is to be effected by way of a court-approved plan of arrangement under the Business Corporations Act (British Columbia), the closing of which remains subject to securityholder, court and regulatory approvals, and other closing conditions customary to transactions of this nature. Completion of the transaction is not subject to any financing condition.

Under the arrangement agreement, the company is subject to customary non-solicitation covenants with customary fiduciary out provisions that entitle the board to consider and, subject to certain conditions, accept a superior proposal if the purchaser does not match such superior proposal. If the arrangement agreement is terminated under certain circumstances, including circumstances in which the company terminates the arrangement agreement to accept a superior proposal prior to approval of the transaction by securityholders, the company is required to pay to the purchaser a termination fee equal to $4.25-million. There can be no assurance that a superior proposal will be made, and the company does not intend to publicly disclose developments with respect to any interest received by third parties, unless and until the board make a determination requiring further disclosure.

A special meeting of affected securityholders to consider and, if deemed advisable, approve the transaction is expected to be held in August, 2025. In order to be approved at the meeting, the transaction will require the approval of: (a) at least two-thirds (66.67 per cent) of the votes cast at the meeting in person or by proxy by holders of shares; (b) at least two-thirds (66.67 per cent) of the votes cast at the meeting in person or by proxy by the affected securityholders, voting together as members of a single class; and (c) if required, a simple majority of the votes cast at the meeting in person or by proxy by holders of shares (other than shares required to be excluded under MI 61-101 and the applicable rules and policies of the TSX-V).

Pursuant to the transaction:

1. Each holder of an in-the-money stock option of the company that is outstanding immediately prior to the completion of the transaction will be entitled to receive a cash payment equal to the positive difference (if any) between the consideration and the exercise price of such company option.
2. Each out-of-the-money company option outstanding immediately prior to the completion of transaction will be cancelled without any payment therefor.
3. Each holder of an in-the-money share purchase warrant of the company that is outstanding immediately prior to the completion of transaction will be entitled to receive a cash payment equal to the positive difference (if any) between the consideration and the exercise price of such company warrant.
4. Each out-of-the-money company warrant outstanding immediately prior to the completion of transaction will be cancelled without any payment therefor.
5. Each of the convertible notes of the company outstanding immediately prior to the completion of the transaction will be surrendered by such holder to the company in accordance with their terms in consideration for either: (i) a cash payment from the company upon closing of the arrangement equal to the aggregate principal amount of such company notes, together with the accrued and unpaid interest thereon; or (ii) in the sole discretion of the holder of company notes, the conversion into shares immediately prior to the completion of the transaction of the aggregate principal amount of such company notes, together with the accrued and unpaid interest thereon, at the applicable conversion price thereon, such shares then to be cashed out upon the closing of the arrangement for the consideration.

Additional details regarding the transaction, the background to the transaction, the reasons for the board's recommendations for the transaction and how securityholders of the company can participate in and vote at the meeting will be set out in the company's management information circular and other proxy-related materials to be prepared, filed and sent to the securityholders of the company in connection with the meeting. Copies of the arrangement agreement and the management information circular for the meeting will be filed with Canadian securities regulators and will be made available on the SEDAR+ profile of the company. Securityholders of the company are urged to read those and other relevant materials when they become available. Upon closing of the arrangement, the purchaser intends to cause the shares to be delisted from the TSX-V and will submit an application to cease to be a reporting issuer under applicable Canadian securities laws.

Voting support agreements

In connection with the transaction, certain securityholders and all directors and officers of the company who hold, in aggregate, 14,962,950 shares (representing approximately 33 per cent of the issued and outstanding shares (on a non-diluted basis)) have entered into voting support agreements with the purchaser, providing for such securityholders to vote all shares, share purchase warrants and stock options of the company owned by them in favour of the transaction.

Amendment of secured promissory note

Separately, the company also announced that it has entered into an amending agreement to amend certain terms of the secured promissory note previously issued by the company to an arm's-length third party (the lender), as announced in the company's news release dated April 30, 2025. Among other things, the amending agreement amends the maturity date of the promissory note to the later of six months from the date of the first advance thereunder and such other date as agreed to between the lender and the company in writing. Except as may be necessary to give effect to the foregoing amendments, all other material terms of the promissory note remain unamended.

Advisers

Architect Partners LLC and Evans & Evans Inc. are acting as financial advisers to the board.

Cassels Brock & Blackwell LLP is acting as Canadian legal counsel to the company. Kirkland & Ellis is acting as Hong Kong legal counsel to the company.

Stikeman Elliott LLP is acting as Canadian legal counsel to the purchaser and the parent. Han Kun Law is acting as Hong Kong legal counsel to the purchaser and the parent.

About Banxa Holdings Inc.

Banxa is the leading infrastructure provider for enabling embedded crypto-empowering businesses to embed crypto seamlessly into their existing platforms and unlocking new opportunities in the rapidly evolving crypto economy. Through an extensive and growing network of global and local payment solutions and regulatory licences, Banxa helps businesses provide seamless integration of crypto and fiat for global audiences with lower fees and higher conversion rates. Headquartered in the United States, Europe and Asia-Pacific, the Banxa team is building for a world where global commerce is run on digital assets.

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