NOW NowVertical Group Inc

NowVertical Group Inc. (TSXV: NOW) ("NOW" or the "Company"), the VI software and solutions company, is pleased to announce that it has entered into a definitive agreement to acquire 100% of the issued and outstanding securities of two U.K. based data analytics solution providers, (the“Acquisitions”), Acrotrend Solutions (“Acrotrend”) and Smartlytics Consultancy (“Smartlytics”) for total gross consideration of US$6.45 million (the “Purchase Price”), subject to customary post-closing adjustments. The Acquisitions are expected to increase NOW’s Revenues by approximately US$6.1 million and Adjusted EBITDA by approximately US$1.9 million for the trailing 12-month period (unaudited), pre-synergies.

“The acquisitions announced today represent NOW’s 10th and 11th made to date," said Daren Trousdell, Chairman & CEO of NOW. “Our vision since the beginning has been to create an efficient capital allocator that combines solid organic and inorganic growth for the long term. These companies are excellent examples of how we are creating value for investors. The addition of the Acrotrend and Smartlytics teams will help accelerate and grow our expected positive Adjusted EBITDA and add additional opportunities for further organic growth in the UK, a key market for NOW. They also set the stage for our next round of acquisitions that, under the NOW banner, will help customers realize the potential of Vertical Intelligence.”

About Acrotrend:

Founded in 2007 by Sandeep Mendiratta and Shailesh Mallya, Acrotrend is a UK-based customer data & analytics consultancy that will complement NOW’s established UK technology presence with practical data science and sophisticated AI to enhance customer lifetime value (“CLV”) for our clients. With a focus on medium to large enterprises, Acrotrend accelerates cloud data modernization journey and delivers solutions on leading technologies primarily within the sales, marketing, customer services and digital functions through a scalable and efficient operating model.

With operations in the UK and India, Acrotrend has been working with globally renowned brands across multiple verticals, including Reed Exhibitions (RX), The Economist Group, The Walt Disney Company, Sky Group, Informa, Nuffield Health, GSK and Cancer Research UK.

“At Acrotrend, we’ve spent the last 15 years delivering value within data and analytics that results in long-term positive impact on our clients. By joining forces with NOW, we’ll be able to deliver that same experience on a massively increased scale,” said Sandeep Mendiratta, Co-Founder and Chief Executive Officer of Acrotrend. “The combined commercial delivery potential and high value solutions will be a game changer for so many of our current and future clients.”

About Smartlytics:

Smartlytics develops end-to-end data solutions to eliminate data silos and create a single source of truth. As a full-service customer insight and analytics company, Smartlytics specializes in customer data science providing “SMART” recurring revenue contracts for corporations. It also provides more extensive service engagements to larger organizations on a customized basis through its head office in the UK and operations in Dubai, UAE and Cairo, Egypt. Its clients and experience include working with public and private sector organizations such as Signal AI, Leicestershire County Council, Redington and Patrizia.

Smartlytics’s technology solution, Smartlytics Hub, is a cloud-native end-to-end platform that enables self-serve development of enterprise data solutions. The platform integrates the latest data science and business intelligence innovations, machine learning, and analysis in a secure, scalable, and cost-effective offering for public and private sector organizations that reduce costs, increase demand and deliver an outstanding customer experience.

“We're excited to join forces with NOW to accelerate our growth and new capabilities for our customers," said Mostafa Hashem, Managing Director of Smartlytics. "This decision grew naturally out of our commitment to sustaining our growth trajectory for our team members and positioning us to drive service expansion with our category-leading clients. With their world-class capabilities, talent, and client roster, NOW was the ideal partner for us.”

Transaction Details

Under the terms of the definitive purchase agreements dated December 5, 2022, the Company has agreed to complete the Transactions in aggregate for (i) a closing cash payment of US$5.1 million, subject to holdbacks, (ii) issuance of 1.35 million subordinate voting shares in the capital of NOW (“NOW Shares” each a “NOW Share”) priced at the greater of NOW’s 20-day VWAP on closing and $1.00 USD per NOW Share, subject to holdbacks, and (iii) earn-out consideration paid over three fiscal years based on certain Adjusted EBITDA targets.

Closing of the Acquisitions is subject to customary conditions for transactions of this nature, including the receipt of necessary third-party consents, regulatory approvals and approval of the TSXV. NOW expects the Acquisitions to be completed before the calendar year end 2022. The Now Shares issuable in connection with the Transactions will be subject to a statutory hold period of 4 months and a day from the closing date (or in the case of any Now Shares issued in connection with the earn-out consideration, four months and a day from such issuance date).

About NowVertical Group Inc.

NOW is the VI software and solutions company growing organically and through acquisition. NOW's VI solutions are organized by industry vertical and are built upon a foundational set of data technologies that fuse, secure, and mobilize data in a transformative and compliant way. The NOW product suite enables the creation of high-value VI solutions that are predictive in nature and drive automation specific to each high-value industry vertical. For more information about the Company, visit www.nowvertical.com.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For further information, please contact: Daren Trousdell, Chief Executive Officere: daren@nowvertical.comt: (212) 302-0868 orGlen Nelson, Investor Relationse: glen@nowvertical.comt: (403) 763-9797

Forward-Looking Statements

This news release may contain forward-looking statements (within the meaning of applicable securities laws) which reflect the Company's current expectations regarding future events. Forward-looking statements are identified by words such as "believe", "anticipate", "project", "expect", "intend", "plan", "will", "may", "estimate" and other similar expressions. These statements are based on the Company's expectations, estimates, forecasts and projections and include, without limitation, statements regarding the future success of the Company's business.

The forward-looking statements in this news release are based on certain assumptions. The forward-looking statements are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, these forward-looking statements are made as of the date of this news release and, except as expressly required by applicable law, the Company assumes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Cautionary Note Regarding Non-IFRS Measures

This news release makes reference to certain non-IFRS measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS, and are therefore, unlikely to be comparable to similar measures presented by other companies. Instead, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company’s results of operations from management’s perspective. The Company’s definitions of non-IFRS measures used in this news release may not be the same as the definitions for such measures used by other companies in their reporting. Non-IFRS measures have limitations as analytical tools and should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS. The Company uses non-IFRS financial measures including “Adjusted Revenues”, “EBITDA” and “Adjusted EBITDA”. These non-IFRS measures are used to provide investors with supplemental measures of our operating performance and to eliminate items that have less bearing on our operating performance or operating conditions and thus highlight trends in our core business that may not otherwise be apparent when relying solely on IFRS measures. Specifically, the Company believes that Adjusted EBITDA, when viewed with the Company’s results under IFRS, provide useful information about the Company’s business without regard to potential distortions. By eliminating differences in results of operations between periods caused by factors such as acquisition-related adjustments, depreciation and amortization methods, impairment and other charges, the Company believes that Adjusted EBITDA can provide a useful basis for comparing the current performance of the underlying operations being evaluated. The Company believes that securities analysts, investors and other interested parties frequently use non-IFRS financial measures in the evaluation of issuers. The Company’s management also uses non-IFRS financial measures in order to facilitate operating performance comparisons from period to period and to prepare annual budgets and forecasts.