XTM Inc. — Capital/Financing Update 2024

Feb 8, 2024

Form 51-102F3 Material Change Report

• Item 1

Name and Address of Company

XTM Inc. 67 Mowat Suite 437 Toronto, ON M6K 3E3

• Item 2

Date of Material Change

January 25, 2024

• Item 3 News Release

A news release was issued by XTM Inc. (the “ Company ”) and subsequently filed on SEDAR at www.sedar.com on February 7, 2024.

• Item 4 Summary of Material Change

The Company announced that the Company has closed the first tranche of its previously announced non-brokered private placement offering (the “ Offering ”) with the placement of 3,842 Convertible Debentures (each a “ Debenture ”) at a price of US$1,000 per Debenture for a gross proceeds of US$3,842,545 (C$5,201,884).

Item 5

Full Description of Material Change

See the press release attached as Schedule “A” hereto.

• Item 6

Reliance on subsection 7.1(2) or (3) of National Instrument 51-102

Not Applicable.

• Item 7 Omitted Information

Not Applicable.

• Item 8 Executive Officer

To obtain further information please contact: Marilyn Schaffer, Chief Executive Officer, at (416) 260-1641

• Item 9 Date of Report

DATED at Toronto, ON this 8th day of February, 2024.

SCHEDULE ‘A’

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NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

XTM ANNOUNCES INITIAL TRANCHE CLOSING OF PREVIOUSLY ANNOUNCED NON-BROKERED PRIVATE PLACEMENT OF CONVERTIBLE DEBENTURES

Toronto, Canada – February 6, 2024 – XTM INC. (CSE: PAID; QB: XTMIF; FSE:7XT) (“ XTM ” or the “ Company ”), is pleased to announce that, further to the press release issued by the Company on December 13, 2024, on January 25, 2025 (the “ Initial Closing Date ”) the Company closed the initial tranche of its previously announced non-brokered private placement offering (the “ Offering ”) of secured convertible debentures in the principal amount of US$1,000 at a rate of 12% per annum from the date of issuance by the Company per Debenture (each a “ Debenture ”) and is due 24 months after the date of issuance. The initial tranche of the Offering that closed consisted of 3,842 Debentures for gross proceeds of US$3,842,545 (C$5,201,884).

Each Debenture shall be convertible at the option of the holder thereof into units (“ Units ”) of the Company at a price of US$0.11 per Unit. Each Unit shall entitle the holder thereof to receive one fully paid and non-assessable common share in the capital of the Company (“ Common Shares ”), for no additional compensation, and one warrant to purchase a Common Share (each a “ Warrant ”) upon payment of US$0.11 to the Company for a period of 24 months from the Initial Closing Date, provided, however, that if the daily volume-weighted average trading price of the Common Shares on the Canadian Securities Exchange (the “ Exchange ”) is greater than C$0.50 for any 5 consecutive trading days (the “ Acceleration Trigger ”), the Company may, upon providing written notice to the Warrant agent, within 3 trading days of the Acceleration Trigger, accelerate the expiry date of the Warrants to a date that is at least 30 days following the date of such written notice.

The Debenture will be a secured obligation of the Company ranking junior in right of payment to all existing secured credit agreements and financing arrangements of the Company, and senior in right of payment to all current and future unsecured obligations of the Company.

XTM paid a cash finder’s fees in the aggregate amount of C$98,560 to a finder. XTM also issued to the finders an aggregate of 98,560 share purchase warrants (the “ Finders’ Warrants ”) having the same terms as the warrants issued pursuant to the Offering. The Finders’ Warrants entitles the holder thereof to purchase one Common Share at a price of US$0.11 per share for a period of 12 months.

The Company intends to use the net proceeds of the Offering for general corporate and working capital purposes. The closing of this Offering is anticipated to close on or about February 8, 2024, or such other date or dates that the Company may determine (the “ Closing ”). The Closing is subject to certain conditions, including, but not limited to, the satisfaction of customary closing conditions and the receipt of regulatory approvals, including the approval of the Exchange. There can be no assurance as to whether or when the proposed Offering may be completed, or as to the actual size or specific terms of the Offering.

The securities issued in connection with the Offering are subject to a statutory hold period of four months and one day from the date of issuance.

About XTM INC.

XTM is a Miami and Toronto, Denver and London-based Fintech creator of payment innovations including fully certified and vertically integrated Earned Wage Access through its QRails AnyDay™ product. Founded in the cloud-banking space to further support businesses to inspire their workforce in the hospitality, personal care and services staffing industries, XTM provides on-demand pay for many large brands including Earls, Maple Leaf Sports & Entertainment, Cactus Club, Marriott Hotels and Live Nation. XTM continues to innovate with further

digital featurization to support businesses to inspire workers to want to work more with shift scheduling and callouts, staff management, expense management, in-app health and financial wellness; and gamified loyalty programs. XTM’s Today Financial™ is in use through POS and Payroll integrations and directly through webportals by thousands of businesses and their workers across Canada and the United States.

For further information, please visit www.xtminc.com or contact:

Marilyn Schaffer Chief Executive Officer XTM Inc. 416.260.1641 finance@xtminc.com

Cautionary Notes