Investor Presentation June 2018 Forward Looking Statements 2 This - - PowerPoint PPT Presentation

Investor Presentation June 2018

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Forward Looking Statements

This presentation contains “forward-looking information” which may include, but is not limited to, statements with respect to the activities, events or developments that the Company expects or anticipates will or may occur in the future. Such forward-looking information is often, but not always, identified by the use of words and phrases such as “plans,” “expects,” “is expected,” “budget,” “scheduled,” “estimates,” “forecasts,” “intends,” “anticipates,” or “believes” or variations (including negative variations) of such words and phrases, or state that certain actions, events or results “may,” “could,” “would,” “might” or “will” be taken, occur or be achieved. These forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business. Management believes that these assumptions are reasonable. Forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors include, among others, risks related to the speculative nature of the Company’s business, the Company’s formative stage of development and the Company’s financial position. Forward-looking statements contained herein are made as of the date of this presentation and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results, except as may be required by applicable securities laws. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information.

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VersaPay

2006 2009 Ranked #1 in Profit Top 50 in IPO on Toronto Stock Exchange January 2010 2013/14 Two lines of business: Payments & Solutions

MERCHANT SERVICES

Strategic partnerships: Banks & CC Companies 2015 Ranked Top 20 Most Innovative Public Companies IDC company profile January 2016

OUR MISSION IS TO DRIVE A SEA CHANGE IN THE WAY COMPANIES MANAGE THEIR ACCOUNTS RECEIVABLE

2017 Merchant Services business sold to BluePay to focus on ARC 3 White label partnership launched Significant backing by global institutional investor Named TSXV Tech Company of the Year 2018

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Current State of AR

SUPPLIER CUSTOMER

Supplier creates invoice Email

• r Mail

Customer requests new invoice

THE MESSY MIDDLE

§ Customers may lose their invoices § There may be disagreements

• n invoice amounts or terms

§ Customers may not call you when there is a problem § Time passes

HASN’T CHANGED IN DECADES

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ARC: AR Reinvented

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Collaboration

Communicate with customers Track and manage customer commitments and follow-ups

2 3 Collections

Invoice related activity and payments recorded in one place, enabling visibility and automated follow-up

4 Payments

Offer customers breadth of electronic payment options PCI compliant manner

5 Cash Application

Payments made through ARC are automatically matched and reconciled with 100% accuracy

6 Automation, Insights, and Visibility

Snapshot of your enterprise’s analytics & customer behaviors

Presentment

Publish invoices & supporting documentation online and deliver electronically

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“The ROI for this project is a no-brainer” A Compelling Business Case

Customer satisfaction Days to get paid Actionable insights Collections Labor and

• ther costs

Cash application

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The Opportunity (Selected Verticals)*

165,000

U.S. firms with $50M to $1B in revenue

>$5B USD

MARKET SIZE

88%

Percent of U.S. firms rely on paper invoices

Selected Vertical Industries:

• Media
• Trucking / Logistics
• Commercial Realty / Property Managers
• Wholesale / Distributors
• Manufacturing
• Professional Services

* 1,582 3,845 1,120

50M-100M 100M-500M 500M-1B

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• A compelling value

proposition

• A large untapped market

with limited competition

• Our approach overcomes

historical obstacles

• Partners provide

tremendous market reach

• Experience in the market has

proven our story is compelling

• Addressable market is

estimated to be at least 5B

• Little competition
• The solution, pricing and

implementation approach take away reasons to say no

• Thousands of existing

customers ranging from small business to large corporations

ARC: Positioned to Grow Rapidly

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ARC Adoption (as at May 31st)

141

Clients signed

70%

Customer adoption eAdopted Customers

114,626

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$625M

In paid invoices

3.4M

Invoices delivered Worth

$5.3B

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Recent Highlights

• TSXV Canadian Tech Stock of the Year and Executive
• f the Year (Craig O’Neill) Awards at Cantech

Investment Conference 2018

• Big 4 accounting firm becomes a client
• US expansion plan well under way by year-end ‘17
• Investment from Fidelity to enable US expansion
• Largest deal signed to date with Livingston July ’17
• White label partnership with RBC announced Jul’17

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Go-To-Market Strategy

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Enterprise accounts Extensive client base of Enterprise, mid-market and small businesses Extensive client base of Enterprise and mid- market businesses ARC as distribution channel for financial services to customers of our customers

DIRECT BANKS ERP ARC

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US Expansion Plan

• Build US Direct Enterprise sales force and

expand US-focused marketing

• Add 1-2 US banks
• Add many ERP vendors / ERP resellers
• Deepen channel support for all partners
• Dedicated channel reps
• Joint marketing programs
• ARC as an on-line distribution platform
• On-platform viral marketing tools
• Integrated financial services

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Direct + Channel Sales = MRR Growth

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›

Great Companies are using ARC

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Financial Overview

As of Q1 2018 Financial Statements

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Quarterly Revenues*

Revenue (in thousands)

$0 $200 $400 $600 $800 $1,000 $1,200 Q1 '15 Q2 '15 Q3 '15 Q4' 15 Q1 '16 Q2 '16 Q3 '16 Q4 '16 Q1 '17 Q2' 17 Q3' 17 Q4' 17 Q1' 18

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* Excludes POS Merchant Services business sold in January 2017

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Financial Summary

($000s) Q118 Q117 Q417 Q416

Revenue from continuing op

$1,012 $486 $1,060 $469

Gross Profit from continuing op

675 274 672 213

Gross Margin from continuing op

67% 56% 63% 55%

Net earnings from discontinued op

Nil 8,965 Nil 147

Consolidated Adjusted EBITDA*

(2,514) (1,802) (1,837) (1,594)

Total comprehensive (loss) earning

(2,680) (7,013) (2,521) (1,815)

EPS

($0.07) ($0.06) ($0.08) ($0.06)

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*Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) is a non-IFRS financial measure which does not have any standardized meaning prescribed by IFRS and is therefore unlikely to be comparable to similar measures presented by other issuers. Adjusted EBITDA provides useful information to users as it reflects the net earnings prior to the effect of non-operating expenses and one time events such as interest, tax, depreciation and amortization, share based payments, finance income and expense, other income and expenses and exchange difference arising on translating foreign operations. Management uses Adjusted EBITDA in measuring the financial performance of the Company as this measure reflects results that are controllable by management in day-to-day

• perations. Management monitors Adjusted EBITDA against budget and past results on a regular basis.

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Corporate Information

Ticker (TSXV:VPY) VPY Market Capitalization $79M Stock Price (03/31/17) $2.08 Shares Outstanding (Basic) 37,922,475 Fully Diluted Shares Outstanding 41,565,551 Year End December 31st Cash and cash equivalent (03/31/18) $13.4M Head Office Toronto

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Investment Highlights

þ Market opportunity of over $5B þ First mover advantage þ Leading solution with a proven track record þ Strong customer references and growth in usage þ Signs of widespread “sea change” emerging þ Major channel partners expand market reach tenfold þ Well capitalized to pursue the growth opportunity

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Management Team

20 Craig O’Neill – Chief Executive Officer and Director

Craig O'Neill was appointed to the position of Chief Executive Officer at VersaPay Corporation in September 2013. He has also been a Director on the company’s board since November 2013. He has more than 20 years of experience delivering enterprise software. Prior to joining VersaPay, Craig was the co-founder and CEO of Xeye, where he directed the company’s growth of more than 40% per year and sale to Odyssey Financial Technologies, and ultimately to the Temenos Group, where he became SVP Strategy and Development. His background includes management of large development groups, designing and building foundational components of corporate system architectures and applications, overseeing enterprise CRM implementations and driving strategic business initiatives. Craig holds a B.Sc. from the University of Toronto in Computer Science and Mathematics.

Ross Pellizzari– Chief Revenue Officer

Ross joined VersaPay in September 2017 as the company’s Chief Revenue Officer. Ross has over 30 years of developing go-to-market teams and driving results through customer success as a leader and sales professional across many vertical industries and segments including Financial Services, Retail, Government, Education, Health Care, Distribution and Solution Resellers. Ross has repeatedly achieved success through his focus on customer first relationships, building high performance teams, sales leadership and accountability. Prior to joining VersaPay, Ross has held several high profile leadership positions, including President of Avaya Canada, head of channel sales at Cisco Canada, and Operations Director for Central Canada at Cisco Systems.

Jason Read– Chief Product Officer

Jason joined VersaPay in December 2017 as the company’s Chief Product Officer. Jason has over 20 years of experience in high growth cloud software

• companies. Prior to joining VersaPay Jason held various positions at Descartes over 17 years his most recent position was a Regional Vice President. Prior to working

in the technology sector Jason worked as in Industrial Engineer at Canadian Tire and Xerox. Jason has a Masters Degree in Systems Design Engineering from the University of Waterloo.

Eddie Chan – Chief Technology Officer

Eddie Chan joined Versapay in March 2017 and leads Versapay’s engineering, client implementation and client support efforts. Eddie is an accomplished technology executive, offering over 15 years of career success developing and executing operational strategies to promote organizational growth and the optimal utilization of emerging technologies. Prior to joining Versapay, Eddie worked with companies such as Ericsson, EnStream (Zoompass), Suretap Wallet, Bell Canada, Rogers, and

• Capgemini. Eddie holds an Honours BSc from the University of Waterloo and a PMP (Project Management Professional) certification.

Shouvik Roy – Chief Financial Officer

Shouvik Roy joined VersaPay in June 2018 as the company’s Chief Financial Officer. Shouvik has over 17 years of experience as a finance leader with extensive knowledge in financial reporting, financial planning & analysis, investor relations and regulatory compliance across multiple industries. He is responsible for the company’s finance and accounting function, investor relations, budgeting, strategy execution and helping the Executive team create customer, employee and shareholder value. Prior to joining VersaPay, Shouvik held senior finance positions at various global organizations, including Nike, Home Depot and most recently at FreshBooks, an established Canadian fintech company. Shouvik holds an Honours BBA from Wilfrid Laurier University, as well as the Charted Professional Accountant, Chartered Accountant designation.

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Management Team

21 John McLeod – Vice President, Marketing

John McLeod joined VersaPay in October 2014 responsible for creating and delivering the company’s brand and marketing strategy. John was formerly Vice President, Marketing at Desire2Learn, a global SaaS based learning solutions provider. During his tenure he was instrumental in its growth from 35 employees to a global enterprise of nearly 900 employees serving 13 million learners. John has been a key member of senior management teams driving growth in both start-up ventures and large technology companies including MetroNet Communications, AT&T Canada and Allstream. John holds a BBA from Wilfrid Laurier University, an MBA from the Ivey School of Business at Western University and a CMA designation.

Geoff Coutts – Vice President, Sales

Geoff Coutts has over 25 years experience with such notable technology companies as Samsung, Verizon and Hewlett-Packard. In his role as VP Sales, Enterprise Business, at Samsung Canada he was responsible for managing the sales of mobility and IT related products and services to businesses. Prior to Samsung, Mr. Coutts was the VP & General Manager for Canada for Verizon Enterprise Solutions. He joined Verizon after a long career with Hewlett-Packard Canada, where he progressed from business unit manager to eventually become VP Sales, Enterprise Services.

Kevin Short – Co-Founder and Chief Information Officer

Kevin Short co-founded VersaPay Corporation in 2006 and serves as its Chief Information Officer. Prior to VersaPay Kevin developed the security architecture and oversaw the security design and implementation for the Vancouver 2010 Olympics for Bell Canada. Kevin has been involved in designing, securing and implementing banking infrastructure for Canada's leading financial institutions for more than 13 years. In his career, Kevin has served in a senior capacity for Sun Microsystems, Nortel Networks, TELUS, Shaw Communications, Bell Canada, Enbridge and TransCanada Pipelines.

Frank Opat – Vice President, Software Engineering

Frank Opat joined VersaPay Corporation in February 2014 and leads the software engineering group. Over the past 15 years, he has brought enterprise scale software solutions to market globally, as a consultant, product architect, product manager, and entrepreneur. Prior to joining VersaPay, Frank held senior product leadership roles at Temenos through acquisitions of Odyssey Financial Technologies & Xeye. He co-founded and designed several products servicing the CRM & document management needs of the Canadian mortgage industry. Frank holds a Bachelor of Mathematics & Honours Computer Science from the University of Waterloo.