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Strategic Divestiture of QRails’ Operations to Pateno Payments Positions XTM for Enhanced Financial Efficiency and Scalable Growth
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TORONTO — XTM Inc. (“XTM” or the “Company”) (QB: XTMIF / CSE: PAID / FSE: 7XT), a fintech innovator in automated tip pooling, instant payouts, and Earned Wage Access (“EWA”) through its AnyDay™ platform, is pleased to announce it executed a definitive Asset Purchase Agreement with Pateno Payments Inc. (“Pateno”), a subsidiary of Digital Commerce Group, on April 25, 2025 for the sale of the QRails, Inc. processing technology.
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The strategic transaction, valued at USD $3,000,000 (subject to purchase adjustments), is expected to reduce XTM’s monthly operating costs by approximately 50%, positioning the Company to reach cash neutrality by Q3 2025. The divestiture enhances XTM’s financial profile by removing the burden of the operations and expense of running the processor while maintaining the business continuity and service offerings through ongoing access to the QRails processing platform.
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XTM will retain full ownership and management of its proprietary EWA platform, including key contracts, integrations with payroll, time & attendance, and other critical systems.
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The Company’s core QRails processing engineering team has already transitioned to Pateno to ensure operational continuity and support for both XTM and Pateno clients. The transaction delivers immediate non-dilutive capital and significantly reduces overhead, providing meaningful margin expansion and growth runway.
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KEY STRATEGIC BENEFITS TO SHAREHOLDERS
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- Improved financial flexibility with near elimination of monthly burn and a strengthened balance sheet
- Margin improvements on interchange and real-time payments, which represent a sizeable portion of the Company revenues
- Non-dilutive capital injection to accelerate growth initiatives
- Access to expanded processing capabilities, including virtual card issuance in both Canada and the U.S.
- Operational efficiency gains through improved reporting, scalability, and system redundancy
- Focused strategy with increased attention on core growth and shareholder value
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“THIS TRANSACTION MARKS A PIVOTAL MILESTONE IN XTM’S EVOLUTION,” SAID MARILYN SCHAFFER, CEO OF XTM. “IT ENABLES US TO CONCENTRATE FULLY ON SCALING OUR ANYDAY™ PLATFORM, WHILE BENEFITING FROM A LEANER, MORE AGILE OPERATIONAL MODEL THAT SUPPORTS OUR GROWTH AMBITIONS.”
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The transaction is expected to close within the next five to ten business days, pending customary bank and network approvals.
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ADDITIONAL COMPANY UPDATES
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- Dissolution of the Company’s referral agreement with KOHO, originally announced on November 14, 2024. The Company will revert approximately 10,000 AnyDay members who transitioned to KOHO earlier this year back to the AnyDay™ platform, with full migration expected by June 30, 2025.
- Termination of Proposed Investment Agreement with Pateno: The non-binding letter of intent previously announced between XTM and Pateno, contemplating a proposed investment, has been formally terminated. The transaction is now fully replaced by the present asset sale agreement.
- Debt Elimination: Upon closing of the transaction, XTM will fully repay the EWA funding provided by Two Shores, and settle all interest obligations associated with long-term debt. Following this, the Company will be debt-free, aside from existing convertible debentures.
- Share-Based Compensation Update: As of March 31, 2025, XTM has issued 6.7 million shares at an average exercise price of $0.965, granted to employees and consultants as part of its retention strategy, via restricted share units (RSUs) and stock options.
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These actions reflect XTM’s ongoing commitment to financial discipline, operational focus, and long-term value creation for shareholders.
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ABOUT XTM INC.
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XTM is a fintech company providing modern payment solutions to businesses in hospitality, personal care, and staffing. Its flagship AnyDay™ platform enables on-demand access to earned wages and real-time payments. Powered by QRails technology, XTM’s infrastructure supports seamless payroll disbursement and financial wellness tools for workers and payroll providers globally.
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For more information, visit: www.xtminc.com
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Disclaimer for Forward Looking Statements
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This news release contains “forward-looking information” and “forward-looking statements” within the meaning of applicable securities laws (the “forward-looking statements”), within the meaning of applicable Canadian securities legislation, including management’s plans regarding its businesses. Forward-looking statements are statements that are not historical facts and are generally, although not always, identified by words such as “expect,” “plan,” “anticipate,” “project,” “target,” “potential,” “schedule,” “forecast,” “budget,” “estimate,” “intend” or “believe” and similar expressions or their negative connotations, or that events or conditions “will,” “would,” “may,” “could,” “should” or “might” occur. All such forward-looking statements are based on the opinions and estimates of management as of the date such statements are made. These forward-looking statements are made as of the date of this news release. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the future circumstances, outcomes or results anticipated in or implied by such forward-looking statements will occur or that plans, intentions or expectations upon which the forward-looking statements are based will occur.
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Contacts
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For more information please contact:
Jakob Ripshtein
[email protected]
416.260.1641
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English (US)