Mr. Hamed Shahbazi reports

PAYPAL TO ACQUIRE TIO NETWORKS

PayPal Holdings Inc. and Tio Networks Corp. have signed a definitive agreement, under which PayPal will acquire Tio for $3.35 ($2.56 (U.S.)) per share in cash or an approximate $304-million ($233-million (U.S.)) equity value. The purchase price represents a premium of 25.2 per cent to Tio's 90-trading-day volume-weighted average price as of Feb. 13, 2017, and 22.6 per cent to the 20-trading-day volume-weighted average price as of Jan. 9, 2017, the trading day immediately preceding the date Tio entered into exclusive negotiations with PayPal.

Tio is a leading multichannel bill payment processor in North America and processed more than $7-billion (U.S.) in consumer bill payments in fiscal 2016. Tio serves 14 million consumer bill pay accounts* and offers convenient solutions for expedited bill payment services to financially underserved consumers. The company has more than 10,000 supported billers and numerous direct relationships with billers, which enable Tio to quickly process telecom, wireless, cable and utility bill payments for Tio's customers. Using Tio's approximately 900 operated self-service kiosks, approximately 65,000 retail walk-in locations, and mobile and web solutions, customers can conveniently pay their bills while avoiding the service interruptions and financial penalties associated with missed payment deadlines.

Dan Schulman, president and chief executive officer of PayPal, said: "By acquiring Tio and integrating bill payment into our global payments platform, PayPal adds another key service in our efforts to become a part of a consumer's everyday financial life. Worldwide, more than two billion** people do not have affordable access to basic financial services, making it difficult and expensive for consumers to carry out basic financial tasks, including bill payment. Tio's digital platform and physical network of agent locations make paying bills simpler, faster and more affordable. We are excited by the opportunity to extend this valuable service to our existing customers and welcome new billers and customers to PayPal."

Hamed Shahbazi, chairman and chief executive officer of Tio, remarked: "We founded Tio to make speed and access part of the bill payment experience for the underserved, and we believe that we have created affordable products to serve the needs of all customers. Our mission fits perfectly with PayPal's vision to democratize money. As part of the PayPal team, we believe we will accelerate our growth through expanded distribution and continue increasing access to more billers and services."

Expected strategic benefits of the Tio acquisition:

• Aligned with PayPal's vision: Tio supports PayPal's vision of democratizing money by giving consumers more convenient and affordable ways to pay their bills.
• Expands market opportunity: Tio accelerates PayPal's entry into bill payments with 14 million consumer bill pay accounts*, approximately 60 million transactions processed in Tio's fiscal 2016 and a processing network that includes more than 10,000 billers.
• Extends consumer value proposition: PayPal's intention is to offer Tio's valuable service to PayPal's customers within its on-line and mobile experiences.

Upon closing of the acquisition, Tio will operate as a service within PayPal.

Financial highlights of acquisition

PayPal intends to finance the transaction with cash on its balance sheet. There will be no change to PayPal's previously communicated fiscal 2017 guidance and three-year outlook based on the acquisition of Tio. For the fiscal year ended July 31, 2016, Tio generated $74.7-million in revenue ($57.1-million (U.S.)) and $10.6-million in adjusted EBITDA (earnings before interest, tax, depreciation and amortization, plus stock-based compensation, non-recurring transaction and restructuring expenses) ($8.1-million (U.S.)).

Transaction details

The acquisition is expected to close in the second half of 2017, and will be completed by way of a plan of arrangement under the Business Corporations Act (British Columbia).

The completion of the transaction will be subject to the approval of at least two-thirds of the votes cast at a special meeting of Tio shareholders and optionholders present in person or represented by proxy at the meeting, by: (i) Tio shareholders; (ii) by Tio shareholders and optionholders, voting together as a single class; and (iii) a majority of the votes cast by Tio shareholders present in person or represented by proxy at the meeting, excluding, for this purpose, votes attached to the Tio common shares held by persons described in items: (a) through (d) of Section 8.1 (2) of Multilateral Instrument 61-101 (takeover bids and special transactions).

The meeting of shareholders and optionholders is expected to take place in April, 2017. In addition to Tio securityholder approvals, the transaction is also subject to other closing conditions, including the receipt of approvals relating to Tio's money transmitter licences, the expiration or early termination of the applicable premerger waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, and court approval in British Columbia, Canada.

The transaction has been approved by the boards of directors of each of Tio and PayPal, and the Tio board recommends that Tio shareholders and optionholders vote in favour of the arrangement. The recommendation of the Tio board was based on the recommendation of a special committee of independent directors of Tio. The financial adviser to Tio, Raymond James Ltd., has provided a fairness opinion to the special committee and board of directors of Tio that, subject to the assumptions, limitations and qualifications set out in such fairness opinion, the consideration to be received by Tio shareholders pursuant to the plan of arrangement is fair, from a financial point of view, to the Tio shareholders.

In addition, Tio shareholders, directors and officers, including funds managed by Core Innovation Capital, Napier Park Financial Partners, Edison Partners, Inter-Atlantic Advisors and Inductive Capital, representing approximately 50.4 per cent of the issued and outstanding common shares, have agreed to vote their shares in favour of the transaction. The transaction includes customary deal protection provisions, including non-solicitation of an alternative transaction and a termination fee payable to PayPal under certain circumstances.

Further information regarding the transaction will be contained in the management information circular, which is expected to be mailed to Tio shareholders in March in connection with the special meeting of Tio shareholders to be held to consider the transaction. Copies of the definitive agreement and the management information circular will also be available under Tio's SEDAR profile. In addition, free copies of the documents may be obtained from Tio's investor relations website or by contacting Tio investor relations at investor@tio.com. All Tio shareholders are urged to read the management information circular as it will contain additional important information concerning the transaction.

Advisers

Perella Weinberg Partners LP is acting as financial adviser to PayPal, and Sidley Austin LLP and Blake, Cassells & Graydon LLP are acting as legal advisers on the transaction. Raymond James is acting as financial adviser to Tio, and Davies Ward Phillips & Vineberg LLP, and Fasken Martineau DuMoulin LLP and Morrison & Foerster LLP are acting as legal advisers for the Tio special committee and Tio, respectively.

Notes

One dollar (Canadian) equals 76.4 U.S. cents.

* Consumer bill pay accounts represent the total number of accounts between consumers and billers. A consumer may have a relationship with more than one biller and may have more than one account.

** Source: World Bank Global Findex 2014.

About PayPal Holdings Inc.

Fuelled by a fundamental belief that having access to financial services creates opportunity, PayPal is committed to democratizing financial services and empowering people and businesses to join and thrive in the global economy. Its open digital payments platform gives PayPal's nearly 200 million active account holders the confidence to connect and transact in new and powerful ways, whether they are on-line, on a mobile device, in an app or in person. Through a combination of technological innovation and strategic partnerships, PayPal creates better ways to manage and move money, and offers choice and flexibility when sending payments, paying or getting paid. Available in more than 200 markets around the world, the PayPal platform, including Braintree, Venmo and Xoom, enables consumers and merchants to receive money in more than 100 currencies, withdraw funds in 56 currencies and hold balances in their PayPal accounts in 25 currencies.

About Tio Networks Corp.

Tio is a cloud-based multichannel bill payment processing and receivables management provider, serving the largest telecom, wireless, cable and utility bill issuers in North America. Tio integrates with the back office of billing systems to accept, validate and collect payments through self-service kiosk, retail walk-in, mobile and web solutions. With approximately 60 million transactions processed in fiscal 2016 and a processing network that serves more than 10,000 billers, Tio symbolizes fast, convenient and secure access to expedited bill payment services.

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