IOU Receives Unsolicited Proposal

MONTREAL, July 26, 2023 /PRNewswire/ - IOU Financial Inc. ("IOU" or the "Company") (TSXV: IOU) confirms that it has received a non-binding, indicative unsolicited proposal (the "NMEF Proposal") from North Mill Equipment Finance LLC ("NMEF") to acquire all of the outstanding common shares of IOU ("Shares") at a price of C$0.28 in cash for each Share and takes note of the press release issued by NMEF on July 25, 2023 regarding the NMEF Proposal.

The NMEF Proposal and subsequent announcement are merely an invitation for the Company to negotiate an arrangement agreement with NMEF. The NMEF Proposal is not a formal offer to IOU shareholders, and there is no assurance that NMEF will make a formal offer to any IOU shareholders. Shareholders currently do not need to take any action with respect to the NMEF Proposal or the announcement.

The board of directors of IOU (the "Board") and its special committee are, together with their respective legal counsel and financial advisor, reviewing the NMEF Proposal to determine whether it constitutes a "Superior Proposal" as defined in the Arrangement Agreement entered into between IOU and 9494-3677 Québec Inc. (the "Purchaser") on July 13, 2023 (the "Arrangement Agreement"), and have provided notice of such review to the Purchaser and its shareholders.

The Board has not changed its unanimous approval and recommendation that IOU shareholders vote in favor of the plan of arrangement (the "Arrangement") contemplated by the Arrangement Agreement and, until such time as the Board makes its determination regarding whether the NMEF Proposal constitutes a "Superior Proposal", IOU will continue with the process set forth in the Arrangement Agreement, including holding a special meeting of IOU shareholders called for September 12, 2023 for the purpose of considering and voting on the Arrangement.

A copy of the Arrangement Agreement is available under the Company's profile on SEDAR+ at www.sedarplus.ca.

About IOU

IOU Financial Inc. is a wholesale lender that provides quick and easy access to growth capital to small businesses through a network of preferred brokers across the US and Canada. Built on its proprietary IOU360 technology platform that connects underwriters, merchants and brokers in real time, IOU has become a trusted alternative to banks by originating over US$1 billion in loans to fund small business growth since 2009. IOU was named one of the 50 Best Places to Work in Fintech for 2022 by American Banker and trades on the TSX-V under the symbol "IOU", and on the US OTC markets as "IOUFF". To learn more about IOU's corporate history, financial products, or to join our broker network please visit www.IOUFinancial.com.

Caution Regarding Forward-Looking Statements

Certain statements made in this press release are forward-looking statements within the meaning of applicable securities laws, including, but not limited to, statements with respect to the completion of the Arrangement and the outcome of the NMEF Proposal, and other statements that are not material facts. Often, but not always, forward-looking statements can be identified by the use of forward-looking terminology such as "may", "will", "expect", "believe", "estimate", "plan", "could", "should", "would", "outlook", "forecast", "anticipate", "foresee", "continue" or the negative of these terms or variations of them or similar terminology.

Although the Company believes that the forward-looking statements in this press release are based on information and assumptions that are reasonable, these forward-looking statements are by their nature subject to a number of factors that could cause actual results to differ materially from management's expectations and plans as set forth in such forward-looking statements, including, without limitation, the following factors, many of which are beyond the Company's control and the effects of which can be difficult to predict: (a) the possibility that the Arrangement will not be completed on the terms and conditions, or on the timing, currently contemplated, and that it may not be completed at all, due to a failure to obtain or satisfy, in a timely manner or otherwise, required shareholder, regulatory and court approvals and other conditions of closing necessary to complete the Arrangement or for other reasons; (b) the possibility of litigation relating to the Arrangement; and (c) the potential of a third party, including, but not limited to, NMEF, making a "Superior Proposal" to the Arrangement; and (d) other factors beyond the Company's control which could have a material adverse effect on the Company or its ability to complete the Arrangement.

The Company cautions investors not to rely on the forward-looking statements contained in this press release when making an investment decision in their securities. Investors are encouraged to read the Company's filings available under its profile on SEDAR+ at www.sedarplus.ca for a discussion of these and other risks and uncertainties. The forward-looking statements in this press release speak only as of the date of this press release and IOU undertakes no obligation to update or revise any of these statements, whether as a result of new information, future events or otherwise, except as required by law.

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SOURCE IOU Financial Inc.