Mr. Brian Mosoff reports

ETHER CAPITAL ANNOUNCES STREAMLINED STRATEGIC DIRECTION AND FOCUS ON PROFITABILITY:

Ether Capital Corp. will implement a new strategic plan reorienting the company on a path toward profitability and is focused on delivering a strong net yield above core Ether asset exposure.

The company's strategic plan going forward is based upon three core pillars:

1. Increasing staking exposure to a target of more than 95 per cent of its Ether balance and internalizing operations with custom built intellectual property (IP).
2. A targeted reduction in annual cash operating expenses of over $2-million, such that cash operating expenses for 2024 will be reduced by more than 45 per cent over projected operating expenses for the current fiscal year. Management is implementing restructuring immediately and the full effects of the new operating cost structure are expected to be in place by the first quarter of fiscal year 2024.
3. Implementing a normal course issuer bid program (NCIB). The company has received regulatory approval to initiate an NCIB program with the intention to purchase up to 2,566,662 of its common shares, representing 7.5 per cent of its total issued and outstanding common shares.

"We are committing today to position Ether Capital on a course that will result in value accretion for our shareholders. Our strategy will continue to position the company as the only access point in the capital markets offering Ether exposure, plus the accretive value from staking activities. The material cost reductions being implemented are expected to result in higher profitability for shareholders," said Brian Mosoff, chief executive officer of Ether Capital. "Our new operating plan is designed to ensure that we meet our No. 1 goal to maximize the total return through participating in the core value opportunity of owning Ether and staking our treasury asset at this time," Mr. Mosoff stated.

The company intends to move to a leaner operating model while internalizing its staking activities and bolstering control over its business operations. "We are taking action to consolidate operations and drive efficiencies targeting (pretax) annualized savings of more than 45 per cent over our projected cash operating expenses for the current fiscal year," said Jillian Friedman, chief operating officer. Management expects some restructuring costs in Q2 and Q3 as the company transitions to internalized staking and a leaner operating model, and aims to achieve the targeted cost efficiencies by Q1 2024. "Over the rest of the fiscal year, we intend to internalize staking operations to be better positioned to control costs, further develop in-house IP and be at the forefront of new yield opportunities as they emerge," said Ms. Friedman.

Over the next several months, Ether Capital intends to optimize the amount of its treasury exposure to staking activity. Currently approximately 78 per cent of the treasury is staked and the company plans to increase this amount to approximately 95 per cent by the end of the year. The company plans to achieve this by utilizing its own proprietary infrastructure and monitoring tools that it has developed over the past 18 months. Staking generates yield denominated in Ether and yield fluctuates on a daily basis. The price of Ether is volatile and as such, the company's future revenue from staking has the potential of being volatile as well. Note that any material reduction in the future staking revenue will have an impact on the net cash flow generated after company expenses.

As part of its plan to implement changes that are accretive to shareholders, the company has obtained approval from the NEO Exchange to implement a normal course issuer bid (NCIB) to purchase up to 2,566,662 of its common shares, representing 7.5 per cent of its total issued and outstanding common shares. "We intend to be active with the NCIB to strategically buy shares as they trade at a discount to intrinsic value, with an expectation to provide a strong total value return to our long-term shareholders," said Mr. Mosoff.

The company is also announcing the impending departure of Ian McPherson, chief financial officer, effective Aug. 31, 2023. "Ian has been a great asset to the company and I would like to thank him for his dedication and contributions. We wish him the best in his future endeavours. We are pleased that Ian has agreed to work with the team during the next few months to put in place new finance leadership," said Mr. Mosoff. The company will provide further details on finance leadership when available.

In addition, John Ruffolo's term as an independent director has ended and he will not be standing for re-election at the company's annual general meeting of shareholders on June 16. Mr. Ruffolo's contributions were instrumental in the establishment of the company in 2018. As one of Canada's distinguished finance executives, his insights and guidance have been invaluable. "We extend our heartfelt gratitude to John for being an integral part of our journey," said Som Seif, executive chair of board of directors of the company. As a result of Mr. Ruffolo's departure, and as part of the company's continuing efforts to adjust to a more lean and efficient structure, the board of directors will be reduced in size from five independent directors to four.

The company has also reached an agreement with Purpose Investments to work together to develop and co-launch new quality digital asset investment products, leveraging Ether Capital's intellectual property and its unique expertise in digital assets. Ether Capital's contribution will result in higher financial participation than previously launched products (the company will continue to receive consulting fees in respect of Purpose's existing digital asset products, albeit at materially reduced rates of a 70-to-75-per-cent reduction). The parties intend to execute a formal contract over the coming month.

About Ether Capital Corp.

Ether Capital is a public company that invests its balance sheet in ethereum's native utility token Ether as a core strategic asset, while generating yield through staking the majority of its Ether balance with the primary goal of being a net-accumulator of Ether. It develops unique intellectual property in its pursuit to maximize profits and optimize total return from staking. Ether Capital's management team and board of directors is composed of crypto natives, leading venture capitalists and traditional finance experts, which uniquely positions the company to identify and capitalize on opportunities in the digital asset ecosystem.

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