Mr. Jason Ewart reports

HANK PAYMENTS PROVIDES TRANSACTION UPDATE AND ANNOUNCES EQUITY FINANCING AND SHARES FOR DEBT TRANSACTION

Hank Payments Corp. has provided additional information in respect of its previously announced acquisition of 100 per cent of the shares of FUTR Inc. (the target), a private technology company on Aug. 20 and Aug. 29, 2024. The parties have now settled the definitive purchase agreement and are prepared to close on or about Jan. 29, 2025.

The target will allow Hank to consume and store key customer data in a SOC 2-compliant and encrypted platform. This automates key compliance and KYC (know your client) work for Hank while also providing value-added digital vaults to the consumers to store critical personal documents such as loans, leases, insurance and other relevant documents relating to the consumer's financial journey. The company is developing additional plans and applications for the platform and will provide further updates as warranted.

The principal terms of the acquisition remain the same as previously disclosed, with the following additional information being provided:

• As consideration for the purchase of all of the outstanding shares of the target, it is expected that Hank will issue 172,949,626 common shares of Hank, which equates to a total equity value for the target of approximately $8.6-million at a per share value of five cents per share.
• No one new shareholder or related entity will own directly or indirectly greater than 10 per cent of Hank postcompletion of the acquisition.
• Hank will assume the target's liability of (i) $1-million owed to its parent, which will be repaid beginning on Aug. 1, 2025, in the amount of $16,667 per month until repaid, without accruing any interest and (ii) $130,000 promissory note owed to its parent coming due on July 2, 2026, and accruing interest at 18 per cent a year.
• The target will also have $260,000 in cash that will be assumed by Hank as part of the acquisition
• Clarus Securities Inc., acted as adviser in connection of the acquisition and will be paid an advisory fee of $216,250, which will be settled by way of issuance of 4,325,000 common shares of Hank on closing at a per share value of five cents per share.
• All shares issued pursuant to the Acquisition are subject to a contractual lockup and leak-out agreement whereby the shares will be released as to one-third on July 1, 2025, Jan. 1, 2026, and July 1, 2026. The first one-third can be released earlier then July 1, 2025, if the common shares of Hank trade on the TSX Venture Exchange (or other recognized stock exchange) for 10 consecutive trading days at a volume weighted average price of 10 cents per share or greater, subject to the board of directors concluding in their sole discretion, such release will not materially impact the then stock price and trading activity beyond what would be expected given such a release from escrow.

Immediately prior to completion of the acquisition, Hank will issue an aggregate of 14,898,420 common shares to the arm's-length holders of convertible debentures that were issued on Nov. 2, 2024, in the amount of $744,921, which will automatically convert pursuant to their terms at a price of five cents per share. The company will also repay the interest owing on the debentures in cash upon conversion.

The company also intends to complete a non-brokered private placement offering of 11,666,667 common shares at a price of three cents per share for the aggregate principal amount of $350,000. The company expects to close the placement prior to completion of the acquisition. It is expected that the proceeds of the placement will be used for debt repayment and working capital purposes. Shares issued pursuant to the placement will be subject to a statutory four-month-and-one-day hold period from the date of closing.

The company is also pleased to announce agreements with certain creditors for the settlement of amounts owing in the aggregate amount of $461,675 in exchange for the issuance of an aggregate of 13,764,163 shares. The debt settlements are also expected to close prior to completion of the acquisition. The debt settlements include shares issued for $195,745 (6,591,508 shares) and $143,345 (4,760,895 shares) of principal and interest owed to arm's-length and related parties respectively. Further fees owed to former directors of the company and arm's-length parties of $85,588 (1,711,760 shares) and $35,000 (700,000 shares) are included in the debt settlements.

The debt settlements include the settlement of an aggregate of $143,342 with three of the company's management and board members in exchange for the issuance of an aggregate of 4,760,895 debt shares. The issuance of the debt shares to the related creditors constitutes a related party transaction as this term is defined in Multilateral Instrument 61-101: Protection of Minority Securityholders in Special Transactions (MI 61-101). The independent directors of the company, acting in good faith, determined that the fair market value of the debt shares being issued pursuant to the shares for debt transaction and the consideration being paid is reasonable. The company intends to rely on the exemptions from the valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and (b) and 5.7(1)(a) of MI 61-101 as neither the fair market value of the debt shares nor the debt exceeds 25 per cent of the company's market capitalization. All securities issued pursuant to the debt settlements are subject to a four-month-and-one-day hold period from the date of closing.

About Hank Payments Corp.

Hank Payments is a North American leader in consumer fintech software-as-a-service and banking-as-a-service platforms that manage consumer cash flow and budgets on an automated basis using proprietary algorithms that collect, store and disburse cash as required to discharge obligations in a timely fashion. The Hank stack provides for several vertical market applications of the technology, with features specific to channels and enterprise accounts that allow those partners to operate new lines of business and revenue streams, using Hank. The partners benefit from new revenue streams and powerful insights that open up additional opportunities for partners to increase assets using Hank. The company operates exclusively across the United States, with certain leadership and technology functions in Toronto. Hank houses the complex technology, banking, treasury, customer service, sales and operations teams that acquire and service consumers. Hank currently charges upfront enrolment/set-up fees and recurring monthly fees based on the types and quantity of payments that Hank administers for the consumer. The company acquires users through various channels, including: (i) small- to medium-sized enterprises; and (ii) large enterprise businesses. The company's BaaS model is emerging, which is expected to add additional fees, including software licensing and usage fees.

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