WeCommerce announces the completion of the Stamped acquisition. known

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VICTORIA, British Columbia – () – WeCommerce Holdings Ltd. (TSX-V: WE) (“WeCommerce” or the “Companies“Today announced the successful completion of the previously announced acquisition of essentially all assets of Stamped.io Pte. GmbH. (“Stamped“) For up to 110 million US dollars (together the”Acquisition“).

Stamped offers a leading suite of software that enables Shopify merchants to collect and present customer reviews and product ratings, and create their own loyalty and rewards programs that make customer conversion and retention easier. Despite Stamped’s leadership position, the company believes there are significant opportunities to improve Stamped’s business by accelerating customer acquisition and employing WeCommerce best practices.

The acquisition is expected to have a positive impact on WeCommerce’s consolidated revenue, organic revenue growth and operating margins, while also significantly increasing the proportion of corporate revenue generated from recurring subscription revenue streams. We anticipate filing audited annual financial statements from Stamped shortly after closing. As previously announced, we plan to hold an investor presentation and question-and-answer session shortly after additional information becomes available.

“We are very excited to officially welcome Stamped to the WeCommerce family,” said Chris Sparling, CEO of WeCommerce. “We are very excited about the growth potential of Stamped in the coming years.”

“WeCommerce is the perfect partner to make Stamped a leading provider of customer loyalty solutions for online retailers worldwide,” said Tommy Ong, Founder of Stamped.

Acquisition overview

Upon completion of the acquisition, WeCommerce Stamped paid an upfront payment of (i) $ 75 million in cash; and (ii) $ 10 million through the issuance of 496,697 Class A common shares of WeCommerce (the “Common stock“) At a price of CAD 25.43. The upfront cash portion of the consideration was made up of approximately $ 35 million of cash and approximately $ 40 million of borrowing under the Company’s new senior secured credit facility (the “Credit institutions“), Managed by JPMorgan Chase Bank, NA Toronto Branch (“JPMorgan Chase“). Further details of the credit facilities are set out below.

In addition to the $ 85 million upfront payment, WeCommerce may have to pay an additional $ 25 million to Stamped (the “Contingent consideration“In the first quarter of 2022, when Stamped hits a minimum sales target of $ 10 million in 2021, among other things. If payable, Contingent Consideration will be paid, at WeCommerce’s sole discretion, either in cash, by issuing Stamped common shares, or a combination thereof.

Credit institutions

Immediately before completion of the takeover, WeCommerce signed a loan agreement (the “Credit Agreement“) With a consortium of lenders led by JPMorgan Chase. The credit facilities include: (i) a senior revolving credit facility with a total principal amount of $ 20 million; (ii) a senior fixed-term credit facility with a total principal amount of $ 40 million; and (iii) a senior delayed drawing facility with a total face value of $ 20 million.

All of WeCommerce’s obligations under the credit facilities are guaranteed by its material wholly owned subsidiaries (including its subsidiary that acquired Stamped’s assets) (the “Guarantors“), And secured by a security interest in the assets of WeCommerce and the guarantors and the interests of WeCommerce in the guarantors. The loan agreement contains certain common financial and non-financial covenants. The credit facilities mature on April 6, 2026, the fifth anniversary of the credit agreement date.

In addition to financing the acquisition, WeCommerce plans to use the proceeds from the credit facilities: (i) to fund working capital needs and for general corporate purposes of the Company and its subsidiaries in the normal course of business; and (ii) to fund future acquisitions.

Prior to taking out loans under the credit facilities, WeCommerce used the cash on hand to fully repay the existing debt of one of its subsidiaries, Pixel Union Design Ltd., of approximately $ 11.4 million.

About WeCommerce Holdings Ltd.

WeCommerce is a Canadian e-commerce technology holding company that owns a family of companies and brands in the Shopify partner ecosystem, including Pixel Union, Out of the Sandbox, Yopify, SuppleApps, Rehash, and Foursixty. The company’s primary focus is on building, growing, and acquiring companies that serve the Shopify partner ecosystem. These stores mainly consist of SaaS, Digital Goods, and Services stores. In general, these companies create apps and themes, and run agencies that support Shopify merchants.

WeCommerce focuses on the acquisition of companies with growth potential, a sustainable competitive advantage and which are or can become leaders in their respective markets. The company is targeting companies within the Shopify ecosystem because of its trust in the Shopify platform, the fragmented nature of the ecosystem, and the attractive economics that companies in general exhibit. As one of Shopify’s first partners since 2010, WeCommerce believes it is well positioned to continue identifying acquisition opportunities in the Shopify partner ecosystem.

For more about WeCommerce please visit https://www.wecommerce.co/ or refer to the public disclosure documents available under WeCommerce’s SEDAR profile on SEDAR at www.sedar.com.

Cautionary Note Regarding Forward-Looking Information

This press release contains statements that constitute “forward-looking statements” and “forward-looking information” within the meaning of applicable securities laws (collectively, “forward-looking statements“), Including statements about the Company’s plans, intentions, beliefs and current expectations for future business activities and operational performance. Forward-looking statements are often accompanied by the words “could”, “would”, “could”, “should”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” or similar expressions and forward-looking statements in this press release include, but are not limited to, information and statements relating to: the anticipated benefits of the acquisition; the Company’s revenue and cash flow upon completion of the acquisition, including the Company’s expectation that a majority of its revenue will consist of recurring subscription income; the company’s belief that the acquisition will add significant value to shareholders; and expectations for other economic, business, and / or competitive factors.

Investors are cautioned that forward-looking statements are not based on historical facts but instead reflect the company’s expectations, estimates or projections of future results or events based on management’s opinions, assumptions and estimates as of the date of publication of the statements were deemed appropriate. While the company believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties and should not be relied on because unknown or unforeseen factors could have a material adverse effect on future results , Accomplishments or accomplishments could have of the company. Financial outlooks, like forward-looking information in general, are based, without limitation, on the assumptions set forth herein and are subject to various risks.

Key factors that could cause actual results to differ materially from those projected in the forward-looking statements include the following: the potential impact of the completion of the acquisition on relationships, including with regulators, stock exchanges, lenders, employees and competitors ; the diversion of management time for the acquisition; Assumptions regarding the acquisition and the company’s operations and investment plans after the acquisition is complete; Credit, liquidity and additional financing risks for the company and its holdings; Stock market volatility; Changes in the growth and trends of the e-commerce industry; Changes in the business, direction and plans of the company and its holdings and the associated timing; the company’s actual financial results and ability to manage its cash; Changes in general economic, business and political conditions, including difficult global financial conditions and the impact of the novel coronavirus pandemic; Competitive risks; potential conflicts of interest; Changes in applicable laws and regulations both locally and in foreign jurisdictions; Compliance with comprehensive government regulations; the risks and uncertainties associated with foreign markets; and the other risk factors more fully described in the Company’s filing statement dated November 30, 2020, prepared in connection with its Qualifying Transaction, filed with the Canadian Securities Regulators and available on the Company’s profile on SEDAR at www.sedar.com

Should one or more of these risks or uncertainties materialize, or should the assumptions underlying the forward-looking statements prove incorrect, actual results may differ materially from the intended, planned, expected, assumed, estimated or expected results described herein. While the company has attempted to identify important risks, uncertainties, and factors that could cause actual results to differ materially, there may be others that could cause results not to be as expected, estimated or intended, and such Changes can be significant. The company does not intend and assumes no obligation to update the forward-looking statements, unless otherwise required under applicable law.

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

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