GreenBox POS Letter to Shareholders

Rhea-AI Summary

GreenBox POS (NASDAQ: GBOX) has announced a shareholder update call scheduled for August 3, 2021, focusing on advancements in blockchain-based payment solutions, including the launch of Coyni, a US dollar denominated smart contract token. For FY2021, the company projects approximately $1.65 billion in transaction volume and $58 million in gross revenues, bolstered by recent acquisitions like ChargeSavvy, LLC. GreenBox aims to enhance its presence in European markets and develop strategic partnerships, while also considering a spin-off of Coyni for potential shareholder benefits.

Positive

• Projected transaction volume of $1.65 billion for FY2021.
• Expected gross revenues of $58 million for FY2021.
• Successful acquisition of ChargeSavvy, LLC, expected to enhance processing volume.
• Entry into a binding MOU for acquiring Transact Europe to expand into the European market.
• Planned spin-off of Coyni expected to maximize shareholder value.

Negative

• None.

Company to Host Shareholder Update Call on Tuesday, August 3, at 4:30 PM ET

SAN DIEGO, CA, July 29, 2021 (GLOBE NEWSWIRE) -- GreenBox POS (NASDAQ: GBOX) ("GreenBox" or the "Company"), an emerging financial technology company leveraging proprietary blockchain security and token technology to build customized payment solutions, today issued a letter to shareholders from the Company’s Chairman, Ben Errez.

Dear Valued Shareholders,

It has been a productive year for GreenBox POS thus far and we are grateful for your ongoing support. We continue to make great strides in advancing our blockchain ledger-based payment solutions and more recently, the deployment of our new smart contract technology, branded as Coyni, that we view as a type of stablecoin since they are settled in US dollars. As the world steadily shifts towards cashless payments, smart contracts and stablecoin based payments, we believe GreenBox is at the forefront of these trends and well positioned to be a key player in the financial payments space. We are constantly challenging ourselves to be an innovative and forward-thinking industry leader in today’s competitive financial payments market.

Our core business remains on track with previous estimates of approximately $1.65 billion in transaction volume for FY2021, which is projected to drive an estimated $58 million FY2021 in gross revenues. These values include the expected contribution from our acquisition of ChargeSavvy, LLC but does not include estimated contributions from Coyni. We are proud of our work and progress so far this year. We look forward to updating shareholders at our second quarter earnings announcement.

Recently, we made several major announcements that we believe demonstrate our progress towards continued execution of our global strategy. To ensure proper understanding of these milestones, we felt it appropriate to issue this shareholder letter in addition to hosting a corporate update webinar on Tuesday August 3^rd, at 4:30 p.m. ET. Details for the webinar are provided below:

Date: Tuesday, August 3^rd, 2021
Time: 4:30 p.m. Eastern time
Dial-in: 1-877-407-4018
International Dial-in: 1-201-689-8471
Conference Code: 13722012
Webcast: http://public.viavid.com/index.php?id=146102

Current volume and revenue guidance is due to expected increased volume and revenues from the scalability achieved with our Generation 3 launch, the growing agent network being cultivated by the GreenBox team, and in large part, strategic acquisitions. Partnerships are essential for successful payment processing businesses, and based on our technological advancements with Generation 3, an eye towards enhanced customer support, renewed integration strategies, and evolving compliance, we continue to build our ISO and agent network, resulting in expected high volume books of business brought into our processing ecosystem.

While our ISO and agent network is vital to our growth, acquisitions will play a primary and an integral role in our strategy. As such, we successfully completed two accretive acquisitions this year - Northeast Merchant Services, which added banking capabilities through a BIN, and ChargeSavvy, LLC, which carried over a substantial and attractive book of processing volume. Both will contribute to increased processing volume in what we believe are higher margin business verticals while expanding our banking capabilities and bandwidth.

Most recently, we announced we entered into a binding MOU for the acquisition of Transact Europe, for which we expect regulatory approval in approximately 60 days. This strategic acquisition, if completed, is expected to allow an aggressive expansion into the European market by leveraging Transact Europe’s principal level membership of Visa, worldwide membership of Mastercard, and as a principal member of China UnionPay. Given Europe’s large void in the payment processing space due to the departure of Wirecard, we believe that our technology paired with the right licensing assets will position GreenBox as a key player in that region. Additionally, our robust agent and ISO network will help us bring together more strategic partnerships with the goal of creating what we believe will be our own significant processing footprint in the EU, all while driving adoption of Coyni. Global expansion remains a core objective of GreenBox and will be key to the adoption and growth of our payment and smart contract token technologies.

The recently announced partnership with the Territorial Bank of American Samoa, whereby we expect to launch a fully customized financial solution to support the entire island of American Samoa, is an opportunity to showcase the impact of an adoption of our technologies in closed loop systems. The initial proof of concept will be fully dependent on the GreenBox ecosystem which supports merchant services, peer-to-peer payments, electronic bank transfer (EBT), ATM, blockchain ledger financial backing, card issuing, and banking related services. The possibility for GreenBox through a proof of concept to ultimately be the recognized provider for the island’s financial services would be an important demonstration of our ecosystem.

We are most excited about our smart-contract US dollar denominated token technology, recently branded as Coyni. As previously discussed, Coyni has features unlike many other stablecoins, cryptocurrencies or tokens in existence such as instant settlement on our proprietary blockchain ledger, reversibility and the ability to be deleted. The instant settlement feature on our proprietary blockchain ledger gives our customers faster access to funds in many locations and currencies, crypto or fiat, all at lower fees and on a tokenized secure ecosystem. We anticipate that the combination of our payment acquiring division with Coyni will help solve two very important problems for global or multinational companies: the first is accurate and centralized monthly reporting; and the second is access to the underlying capital, quickly, in the parent company location.

We expect Coyni to be a major growth driver for the company, and ultimately function in a similar fashion to financial transaction leaders like Circle with its USDC, and PayPal with Venmo,

As part of our long-term strategy to unlock shareholder value, we have explored a number of strategic options and currently believe that Coyni is best structured as a spinoff company (a “SpinCo”). We are continuing, however, to evaluate different strategies and alternatives. The assets of the SpinCo are expected at this time to include the smart contract token technology, Coyni branding, and associated revenue, although we will continue to evaluate and assess other possible strategies. We believe the SpinCo strategy is advantageous to GreenBox and its shareholders in several ways. First, both GreenBox and the SpinCo may be valued as pure-play financial technology and financial services companies, respectively. Second, it allows for the SpinCo, and its new management team, to focus wholly and entirely on growing and enriching the Coyni business model, positioning it as a focused competitor with clear differentiated technology advantages relative to traditional payment systems. Third, it allows both GreenBox and the SpinCo to potentially maximize the utility of their respective capital structures, without diluting either investment thesis. We spent countless hours evaluating the best strategy for maximizing shareholder value of both assets – the core GreenBox technology platform and the Coyni smart contract US dollar denominated tokenized platform – and we believe we are making the right decision for stockholders in spinning off Coyni.

For these reasons, we announced our intent to implement a special dividend series to reward long-term, loyal shareholders of GreenBox. While our analysis of the strategies and record dates are still under considerations, there are two possible opportunities we expect to be awarded representation of shares in the SpinCo IPO. First, every shareholder of record of GreenBox on or about August 16, 2021, will receive 0.30 shares representation in the SpinCo for each share of GreenBox common stock held. Second, approximately 45 days prior to the SpinCo IPO, which is expected to occur in the fourth quarter of 2021— shareholders of record of GreenBox may be awarded 0.15 shares representation in the SpinCo for each share of GreenBox held. GreenBox shareholders of record on both dates, under our current thinking, can therefore receive up to 0.45 shares representation in the SpinCo for each share of GreenBox common stock held. It is our anticipation that SpinCo shares will be listed at the time of the IPO on the NASDAQ or a similar major exchange. GreenBox currently intends to maintain majority equity ownership stake in the SpinCo after IPO and dividend.

We hope this summary provides additional clarity to our corporate vision and objectives on how we are building GreenBox to be, we believe, the newest, most agile, and robust payment software technology to compete in the digital payment space. Thank you for being a part of the GreenBox family. We are grateful for your ongoing support and attention to our story. Please continue to follow along in our journey. Your success is our success!

Sincerely,

Ben Errez
GreenBox, Chairman

About GreenBox POS

GreenBox POS (NASDAQ: GBOX) is an emerging financial technology company leveraging proprietary blockchain security to build customized payment solutions. The Company's applications enable an end-to-end suite of turnkey financial products with fraud detection technology, improving the efficiency of handling large-scale commercial processing volumes for its merchant clients. For more information, please visit the Company's website at www.greenboxpos.com.

Disclaimers

This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities and shall not constitute an offer, solicitation or sale of any security in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. Any offers, solicitations, or offers to buy, or any sales of securities will be made in accordance with the registration requirements of the Securities Act of 1933, as amended.

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. All forward-looking statements are inherently uncertain as they are based on current expectations and assumptions concerning future events or future performance of the Company. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. In evaluating such statements, prospective investors should review carefully various risks and uncertainties identified in this release and matters set out in the Company's SEC filings. These risks and uncertainties could cause the Company's actual results to differ materially from those indicated in the forward-looking statements.

Investor Relations Contact
Mark Schwalenberg
MZ Group - MZ North America
312-261-6430
GBOX@mzgroup.us
www.mzgroup.us

FAQ

What is the date and time of GreenBox's shareholder update call?

The shareholder update call is scheduled for August 3, 2021, at 4:30 PM ET.

What is the projected revenue for GreenBox in FY2021?

GreenBox is projecting approximately $58 million in gross revenues for FY2021.

What is the expected transaction volume for GreenBox in FY2021?

GreenBox expects to achieve approximately $1.65 billion in transaction volume for FY2021.

What is Coyni and how does it relate to GreenBox?

Coyni is a new smart contract token launched by GreenBox, designed to facilitate US dollar-denominated transactions.

What strategic acquisitions has GreenBox made recently?

GreenBox has acquired ChargeSavvy, LLC and entered into a binding MOU for Transact Europe.