Mr. Rob Craig reports

DATABLE TECHNOLOGY CORPORATION UPDATE

Datable Technology Corp. has provided the following update on operations and the letter of intent (LOI) to sell its SaaS (software-as-a-service) business to Local Marketing Solutions Group Inc. (LMSG) as set out in the news release dated June 16, 2023.

"Despite the challenges of the past several years, we have renewed 100 per cent of our long-term SaaS licences with major enterprise customers and have a number of new large enterprises customers in our sales pipeline," said Rob Craig, chief executive officer of Datable. "In Q1 of 2023, as we prepare to sell our SaaS business to LMSG, we cut expenses by 50 per cent while maintaining revenues at the same levels as last year. With access to LMSG's U.S.-based sales team and infrastructure, Datable can scale its high-margin SaaS business while owning shares in LMSG, a much larger and profitable company."

Under the LOI, LMSG will acquire Datable's SaaS business in return for a 15-per-cent equity ownership in LMSG. The LOI sets the value of LMSG at $19.7-million, equal to approximately one times LMSG's 2023 revenues, such that Datable's 15-per-cent ownership of LMSG postacquisition will have a deemed value of approximately $3.5-million:

• Datable and LMSG are making good progress on mutual due diligence and finalizing the definitive agreement, which is expected to be signed prior to July 31, 2023. Concurrently, Datable and LMSG are in discussions to raise capital to support the acquisition and accelerate growth of the combined company.
• As of the date of this news release, Datable has agreements, which, together with licence agreements signed in prior periods, amount to approximately $3.6-million in revenue under contract for 2023 and future periods, of which 56 per cent is expected to be recognized as revenue in 2023. This includes approximately $3.2-million in contracted revenues and close to $400,000 in expected program fees from customers. Datable expects gross margin to be between 40 per cent and 50 per cent in 2023, depending on product mix and an increase and expected improvements in operational efficiency.
• Due to the continued cost cutting and improved operational total, operating expenses are expected to be reduced by approximately 50 per cent for the year ended Dec. 31, 2023, compared with the same period in 2022.

Datable will provide continuing updates as it makes progress on the proposed sale of its SaaS business to LMSG.

About Datable Technology Corp.

Datable has developed Platform 3, a proprietary consumer life cycle and data management platform that is sold to global consumer brands. Platform 3 is delivered as a subscription service (SaaS model), and is used by some of the world's most valuable consumer brands to access new consumer communities and engage them while collecting, analyzing and managing their first party data. Platform 3 incorporates proprietary technology to monetize the consumer data, including demographics and purchasing behaviour, by sending consumers targeted offers by e-mail and text messages.

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