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XSFINANCIAL EQUIPMENT LEASING XS FINANCIAL REPORTS THIRD QUARTER 2021 FINANCIAL RESULTS 502 % Increase in YoY Revenue Contributes to Positive Adjusted EBITDA LOS ANGELES , CA , November 29 , 2021 – XS Financial Inc. ( " XS Financial " , " XSF " or the " Company " ) ( CSE : XSF ) ( OTCQB : XSHLF ) , a specialty finance company providing equipment leasing solutions to cannabis companies in the United States , is pleased to report its financial results today for the quarter year ended September 30 , 2021 ( " Q3 / 21 " ) . All amounts are expressed in U.S. dollars . Q3 / 21 Financial Highlights • 502 % increase in revenue from $ 0.2 million in Q3 / 20 to $ 1.0 million in Q3 / 21 ; • 56 % increase in closed leases from $ 22.1 million in Q2 / 21 to $ 34.6 million in Q3 / 21 ; • 69 % increase in monthly recurring payments from $ 0.6 million in Q2 / 21 to $ 1.0 million in Q3 / 21 ; • 49 % increase in gross lease receivables from $ 26.0 million in Q2 / 21 to $ 38.8 million in Q3 / 21 ; • • Adjusted EBITDA¹ profit of $ 0.4 million ( Q3 / 20 - loss of $ 0.0 million ) and adjusted EBITDA margin of 43 % in Q3 / 21 ; EBITDA loss of $ 0.2 million ( Q3 / 20 - loss of $ 0.3 million ) in Q2 / 21 ; Closed $ 15.0 million credit facility with the Garrington Group of Companies Inc. , the lender finance division of Next Edge Capital to support growth and diversify funding sources available to the Company . Post - Quarter Portfolio and Corporate Highlights As of Q / 21 As of Q2 / 21 As of Q3 / 21 As of 11/29/21 # of Customers # of Active Leases 7 24 8 38 9 52 9 61 Total Closed Leases Since Inception Average Lease Size by Customer Total Equipment Cost $ 10.5 million $ 1.5 million $ 15.2 million $ 22.1 million $ 2.8 million $ 30.4 million $ 34.6 million $ 3.8 million $ 45.6 million $ 39.5 million $ 4.4 million $ 51.2 million Monthly Recurring Payments Gross Lease Receivables $ 0.3 million $ 12.2 million $ 0.6 million $ 26.0 million $ 1.0 million $ 38.8 million $ 1.1 million $ 42.2 million • • • Raised $ 43.5 Million through a private placement of unsecured convertible notes . The financing was led by a large institutional investor , with additional participation from urban - gro ( NASDAQ : UGRO ) , Landrace Financial , Bengal Capital , and KEY Investment Partners ; 9 new lease schedules with Ayr Wellness , Columbia Care , PharmaCann , and Maggie's Farm , resulting in lease originations totaling $ 4.9 million and equipment value totaling $ 5.6 million ; Appointment of Mr. Andrew Mitchell a Research Analyst at Marblegate Asset Management , to the Board of Directors , which now comprises an independent majority , providing additional transparency and strength to the Company's corporate governance . David Kivitz , CEO of XS Financial , commented : “ During the third quarter we achieved significant operational milestones including the Company's largest lease facility commitment to date of $ 21.4 million with Ayr Wellness , as well as our most profitable quarter to date in terms of adjusted EBITDA . We also generated record revenue , increased monthly recurring payments to over $ 1.0 million and accomplished record gross lease receivables . The closing of our $ 15.0 million credit facility and our $ 43.5 million financing earlier this month has transformed our financial foundation and positioned us for rapid growth , which we expect to benefit our shareholders . We look forward to delivering positive results related to our key metrics and building out our portfolio and pipeline with existing market - leading operators . " 1 Adjusted EBITDA is a non - IFRS financial performance measure . Adjusted EBITDA is calculated as operating income adjusted for non - cash expenses , non - cash equity incentives and one - time non - operating expenses . 1