IOU Financial Inc. announced it has delivered a notice to North Mill Equipment Finance LLC ("NMEF") advising NMEF of its determination that the non-binding, indicative unsolicited proposal (the "NMEF Proposal") received from NMEF to acquire all of the outstanding common shares of IOU ("Shares") at a price of 28 cents in cash for each Share does not constitute a "Superior Proposal" under the Arrangement Agreement entered into between IOU and 9494-3677 Québec Inc. (the "Purchaser") on July 13, 2023 (the "Arrangement Agreement") and therefore does not provide a basis upon which to enter into discussions with NMEF. That determination follows a comprehensive review of the NMEF Proposal by the special committee (the "Special Committee") of the board of directors of IOU (the "Board") and the Board, with the benefit of advice of their legal counsel and financial advisor.

The Special Committee and the Board (with Philippe Marleau, Lucas Timberlake and Robert Gloer abstaining from deliberations and voting) arrived at this determination, among other reasons, on the basis of the written confirmation provided to them by the Purchaser and its affiliates, who own, control, direct or have subject to a hard lock-up more than 48 percent of the issued and outstanding Shares (on a non-diluted basis), that they would not vote (or permit to be voted) any such Shares in favor of the NMEF Proposal. To be successfully consummated, the NMEF Proposal would need, among other things, to gather the support of more than two-thirds of the holders of Shares (the "Shareholders"), which would not be possible in the present circumstances without the support of the Purchaser and its affiliates. Despite having been given an opportunity, in writing and orally, to clarify how it intended to overcome the Purchaser's opposition to the NMEF Proposal, NMEF did not propose any satisfactory course of action pursuant to which the NMEF Proposal could reasonably be expected to be consummated.

The Board therefore reaffirms its unanimous approval and recommendation (with Marleau, Timberlake and Gloer abstaining from deliberations and voting) that the Shareholders vote for the plan of arrangement contemplated by the Arrangement Agreement (the "Arrangement") and confirms that IOU will continue with the process set forth in the Arrangement Agreement, including holding a special meeting of the Shareholders called for September 12, 2023 for the purpose of considering and voting on the Arrangement. For more information on the Arrangement Agreement, please see IOU's press release of July 14, 2023.