Quorum Q1 2021 Results Investor Presentation FINAL · 2021. 5. 26. · Quorum’s solutions...

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Q1 2021 Results Investor PresentationMay 26, 2021

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FORWARD-LOOKING DISCLAIMERThis presentation document contains certain forward-looking information and statements within the meaning of applicable securities laws. All statements in this presentation, other than statements of historical fact, which addressevents or developments concerning Quorum Information Technologies Inc. ("Quorum" or the “Corporation”) that Quorum expects to occur are "forward-looking information and statements". The use of any of the words "expect","anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "potential", "could", "scheduled", "believe", "plans", "intends", "might" and similar expressions are intended to identify forward-lookinginformation or statements. In particular, but without limiting the foregoing, this document may contain forward-looking information and statements pertaining to the following: business plan of Quorum including its plans for targetingnew Original Equipment Manufacturer (“OEM”) Integration, new dealership roof top sales, and increasing Automotive Group Partnerships; the timing for completion and cost of OEM Integration; estimates of return on assets andAdjusted EBITDA; potential merger and acquisition (“M&A”) opportunities; the timing of adoption of new accounting standards and the potential impact of new accounting standards on the Corporation’s financial statement; the effectof acquisitions on the Corporation; the effect of the BDC Capital facility; the effect of the COVID-19 pandemic on industry activity and economic activity in North America as a whole; various industry activity forecasts; growthopportunities including those in the United States; anticipated requirements by OEM manufacturers relating to integrations and certifications; and other expectations, beliefs, plans, goals, objectives, assumptions, information andstatements about possible future events, conditions, results of operations or performance. Various assumptions were used in drawing the conclusions or making the forecasts and projections contained in the forward-lookingstatements throughout this presentation. The forward-looking information and statements contained in this presentation reflect several material factors, expectations and assumptions including, without limitation: (i) capitalexpenditures by dealers; (ii) market availability of current and future dealership rooftops; (iii) schedules and timing of certain projects and Quorum's strategy for growth; (iv) Quorum's future operating and financial results; and (v)treatment under governmental regulatory regimes and tax and other laws. The forward-looking information and statements included in this presentation are not guarantees of future performance and should not be unduly reliedupon. Forward-looking statements are based on current expectations, estimates and projections that involve a number of risks and uncertainties, which could cause actual results to differ materially from those anticipated anddescribed in the forward-looking information and statements. Such information and statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from thoseanticipated in such forward-looking information or statements including, without limitation: (i) volatility in exchange rates for the Canadian dollar relative to the US dollar; (ii) liabilities and risks inherent in the software servicesindustry; (iii) competition for, among other things, capital and skilled personnel; (iv) changes in general economic, market and business conditions in Canada and the United States; and (v) actions by governmental or regulatoryauthorities including changes in income tax laws or changes in tax laws. Quorum cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive. The forward-looking information and statements contained inthis document speak only as of the date of this document, and Quorum assumes no obligation to update or revise them to reflect new events or circumstances, except as may be required pursuant to applicable laws. Any financialoutlook or future-oriented financial information in this document, as defined by applicable securities legislation, has been approved by management of Quorum. Such financial outlook or future-oriented financial information is providedfor the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate for other purposes.

UNITED STATES

This presentation does not constitute an offer to sell, or a solicitation of an offer to buy, securities in the United States or any other jurisdiction. Any such offer to sell or solicitation of an offer to buy the securities described herein orduring the presentation will be made only pursuant to subscription documentation between Quorum and prospective purchasers. Any such offering will be made in the United States in reliance upon an exemption from registrationunder the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), for an offer and sale of securities that does not involve a public offering, and the offer and sale of the securities will be conditioned on the receiptof representations, warranties and agreements of prospective purchasers to establish that exemption. Any securities described in this document have not been, and will not be, registered under the U.S. Securities Act and may not beoffered or sold in the United States except in transactions exempt from, or not subject to, registration under the U.S. Securities Act and applicable U.S. state securities laws. Accordingly the securities may not be resold, pledged,hypothecated or otherwise disposed of or transferred except in accordance with the registration requirements of the U.S. Securities Act and any applicable state securities laws or pursuant to an applicable exemption from suchregistration requirements of the U.S. Securities Act and any applicable state securities laws. THE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION ORANY STATE SECURITIES COMMISSION NOR HAS THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THISCOMMUNICATION. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

@2021 Quorum All rights reserved. May 26, 2021

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ABOUT QUORUM

Quorum offers innovative and robust software technology solutions totraditional and electric vehicle dealerships and

Original Equipment Manufacturers (“OEM”) across North America

A key problem for dealerships is that they typically use many disparate solutions across 25 categories of software solutions to run their business. There are 700 different vendors’ software solutions within those 25 categories.

Quorum’s solutions help solve this major problem.

Quorum’s integrated product suite drives efficiencies into the dealership, leverages a single enterprise reporting solution and provides measurable Return on Investment (“ROI”). The cost of Quorum’s solution is typically 50% less than competing disparate products.

Dealerships typically start with a single product from Quorum’s product suite and they experience escalating synergy and value as additional solutions are deployed to their dealerships.

For Quorum, the stickiness of the product suite increases as dealerships deploy added products.


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ADJUSTED CASH INCOME (ACI)*: $0.6 million

Q1 2021 KEY METRICS

@2021 Quorum All rights reserved.

At May 21, 2021:Market Cap: $78 millionShare Price: $1.07Shares I&O: 72.8 million

ENTERPRISE VALUE: $82 million

REVENUE: $8.6 millionRecurring Revenue Streams:SaaS Revenue: $6.1 million (71% of revenue)BDC Revenue: $2.2 million (26% of revenue)

GROSS MARGIN: 44%SaaS Revenue: 65%BDC Revenue: 10%

ANNUAL RECURRING REVENUE RUN-RATE*SaaS Revenue: $24.4 millionBDC Revenue: $8.7 million

ADJUSTED EBITDA*: $1.3 million

ROOF TOP COUNT (CUSTOMERS)**: 1,010SaaS MRRPU: $2,013

TOTAL AVAILABLE MARKET (TAM):TAM Canada: 3,235TAM USA: 19,575TAM VALUE: $6 billion annually***

* Please refer to the “Non-GAAP Measures” and “Glossary of Terms” slides in the Appendix of this presentation for the meaning of this term or acronym.** Dealer Rooftop Count – Total for Q4 2019, Q1 2020, Q2 2020 and Q3 2020 have been adjusted to correct prior period Dealer Rooftop Count – Canada. Dealer Rooftop Count – Total and MRRPU were previouslyreported as: Q4 2019 total rooftop count of 1,022 and MRRPU of $1,819; Q1 2020 total rooftop count of 1,027 and MRRPU of $1,922; Q2 2020 total rooftop count of 1,035 and MRRPU of $1,898; and Q3 2020 totalrooftop count of 1,045 and MRRPU of $1,886.*** Based on reach from Empiritas Solutions, dated September 15, 2020.

May 26, 2021

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QUORUM’S INTEGRATED PRODUCT SUITE

OUR CUSTOMERS • Dealer groups (single ownership of multiple dealerships) and single dealership customers.

OUR SALES STRATEGY• Dealerships typically start with a single product from Quorum’s product suite and they experience

increased synergy and value as additional solutions are deployed to their dealerships. For Quorum, the stickiness of the product suite increases as dealerships deploy added products.

DELIVERING CUSTOMER ROI• Measurable ROI for the dealership – for instance, our service lane inspection and quoting solution,

which is part of our ERP and CRM, drives in $60K of customer pay revenue per dealership per month.

INCREASING ROI• As dealerships utilize more of our product suite, both the ROI and the stickiness of our solution

increases.

ENTERPRISE REPORTING ACROSS ENTIRE PRODUCT SUITE• Our ER (Enterprise Reporting) solution provides one reporting tool for our entire product suite.

On their own, Quorum’s solutions allow dealership customers to drive greater success and better results – at less cost than competitors’ products.

When integrated with other Quorum solutions - the Quorum product suite delivers escalating synergy and expanding value.


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MODERNIZATION DRIVES DEMAND for QUORUM


SEAMLESS, FRICTIONLESS WORKFLOWS Better workflows from Sales and Service into the DMS which Quorum delivers through our complete product suite and dealership wide reporting tool.

Dealership wide reporting tool for full Quorum product suite

CHANGING DEALER PRODUCT MIX ACES - autonomous driving, connectivity, electrification, and shared mobility – trends.

May 26, 2021

CONSUMER DIRECT Consumers demanding new way of doing business – Quorum delivers digital retailing and touchless service experience.

Quorum’s service lane inspection and quoting tools provides a touchless consumer experience and drives in $60K of customer pay revenue per dealership per month

IMPROVE PROFITABILITY 1. Greater focus on high margin service and

parts revenue which Quorum has best of class solutions for.

2. Demand higher ROI from all our solutions which Quorum delivers through our Make More Money (M3) strategy.

Quorum’s Business Development Center services – a call centre for dealerships to contactcustomers for service and repair work

Customer Relationship Management Tools drives consumers into the service lane

Our MyDeal, digital retailing solution, and Desk, in store solution, integrate seamlessly ensuring online vehicle payments always match dealership sales staff numbers.

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QUORUM PRODUCTS TODAY & TOMMORROW

Quorum Division Legend:XS - XSellerator

DM - DealerMine

AV - Autovance

4 of the most common software categories that a dealership utilizes or are in the market to purchase

5 additional products that Quorum has developed or acquired

2 New Quorum-developed products released in Q3

There remains $7,300 of customer spend per month for which Quorum does not yet have software solutions for –growth into this product space is an opportunity to capture more of the Customer Spend TAM as MRRPU.

The total North American franchised dealership market value for software product solutions is $6.0 billion annually.

Quorum Product Legend: ERP - Enterprise Resource System (DMS - Dealership Management System is the automotive term)

CRM - Customer Relationship Management System

UC - Unified Communications ER - Enterprise Reporting and Analytics

F&I - Finance and Insurance DR - Digital Retailing (allow customers to buy a vehicle on-line)


TYPICAL MONTHLY

DEALERSHIP SPEND TODAY

QUORUM PRODUCTS

TODAY* (Available MMRPU

Today)

COMPETITOR PRICING

TODAY**

QUORUM PRODUCTS

TOMORROW (Future Additional

MRRPU is $21,800 - $14,500)

$21,800

PLUS 14 More Categories (25 in Total)

Product Category

Available MRRPU $6,000

Available MRRPU $4,300Additional MRR $7,000

$2,013* Quorum product pricing has been rounded to the nearest $100 per product for easier comparitive purposes** Competitor product pricing has been estimated by Quorum and rounded to the nearest $100 per product for easier comparitive purposes

$9,000

DM On Line Scheduling

ERP - XS DMS

Service CRM - DM

#3

DR - AV Desk#4

#5

#11

#6#7#8#9#10

$7,000 $14,500

$2,300

$3,200

$7,300

Quorum SaaS MRRPU in Q1 2021:

Additional Quorum Products

Quorum's Latest Products

$1,000

$1,700

$4,300

Data Mining - XS and DM

F&I - AV Menu

ER - XS Q Analytics

UC - XS Communicator

XS PowerLane

AV Digital Retailing (My Deal)

Quorum's CORE Products

(most dealerships have or are in the

market to purchase these) #1

#2

Sales CRM - XS and DM

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TAM ($1.9 billion); AVAILABLE TAM by DIVISION


TAM:3,235 Auto Dealerships

TAM:19,575Auto

Dealership

1,099, or 34% TAM

Total AVAILABLE TAM, by DivisionXSellerator1,2 ERP(Enterprise Resource Planning System)

DealerMine3,4 CRM(Customer Relationship Management System)

Autovance5 DR(Digital Retailing)

2,014, or 62% TAM

2,922, or 90% TAM

3,943, or 20% TAM

TAM (Total Addressable Market)

9,990, or 51% TAM

19,574, or 100% TAM

Integrating Honda and Mazda OEMs

in Canada increases Available

TAM by 22% to 1,802, or 56% TAM

CANADA• 882 CUSTOMERS at Q1 2021• 27% MARKET SHARE• CANADA TAM VALUE:

$22.6 million/month$271 million/year

(3,235 addressable customers x $7,000 (Quorum full product suite).

USA• 128 CUSTOMERS

at Q1 2021• Less than 1%

MARKET SHARE• USA TAM VALUE:

$137 million/month$1.6 billion/year

(19,575 addressable customers x $7,000 (Quorum full product suite).

1XS Available Canada TAM excludes existing dealers, French only dealers, dealerships non-OEM certified and dealerships not open to multiple ERPs. 2 XS Available USA TAM excludes existing dealers, California & Tennessee dealers, dealerships non-OEM certified and dealerships not open to multiple ERPs.3DM Available Canadian TAM excludes existing dealers and smaller dealers that won’t realize full ROI from the DM products.4DM Available USA TAM excludes existing dealers and smaller dealers that won’t realize full ROI from the DM products.5AV Available TAM excludes existing dealers.

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CROSS-SELLING GROWTH OPPORTUNITY

CURRENT FOCUS: Cross-Selling DealerMine and Autovance to existing XSellerator customers:


Increase Monthly Recurring Revenue Per User (MRRPU):TOTAL Quorum Product Suite: $7,000

REDUCED (as an example) for: ($2,000)• XS cannot be sold to all customers due to OEM certifications not currently in place• DealerMine cannot be sold to all XSellerator or Autovance customers (not a fit for smaller franchise dealerships)

MRRPU Available to Capture: $5,000Less Quorum MRRPU at Q1 2021: $2,013

MRRPU Cross-Selling Opportunity: $2,987 or 2.5x

Currently 14% Service

CRM penetration into XSellerator

Customers

DealerMine With 100% penetration = additional MRRPU of

$376

Autovance

Currently 36% Desk, 7% Menu and 4% MyDealpenetration into

XSelleratorCustomers

With 100% penetration = additionalMRRPU of

$369

Large opportunity to increase the share of existing customer spend, especially during COVID

May 26, 2021

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INNOVATION


INNOVATION & ACQUISITION GROWTH OPPORTUNITIESQuorum is positioned to capture MORE of the Customer Wallet through:

EXPANDED PRODUCT VISION • Long-term product vision created for key product areas• Determine if we develop internally, partner with or

acquire to meet product vision

VAST VENDOR SOLUTION MARKET• Vendor market vast and diverse (700 vendor

solutions)• Multiple innovative solutions• Some attractive and synergistic with Quorum’s

product suite

WELL POSITIONED for CONTINUED GROWTH• Strong acquisition track record• One acquisition per year from 2017 to 2019• Quorum well capitalized

INNOVATION:• In late Q3 2020 Quorum increased its potential

take of the Customer Wallet by $1,000 per month through the launch of the following product solutions:• MyDeal, our Digital Retailing solution to allow

a dealership customer to buy a vehicle online• PowerLane, our service lane inspection tool

• The balance of the Customer Wallet that Quorum can expand into is $7,300 per month ($7,000 of the approximately available $14,300 monthly dealer spend has now been captured through Quorum product solutions).

ORGANIC INNOVATION• Quorum will continue to innovate to

capture more of the available customer wallet

ACQUISITION

Balance of Customer Wallet

$7300

May 26, 2021

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Q1 2021 COMMENTSREVENUE

Total revenue of $8.6 million:

• Q1 2021/Q4 2020:

3% increase

• 2021/2020:

0.5% increase


SaaS* and BDC* REVENUE

SaaS revenue of $6.1 million:• Q1 2021/Q4 2020:

1% increase• 2021/2020:

3% increase

BDC revenue of $2.2 million:

• Q1 2021/Q4 2020: 12% increase

• 2021/2020: 3% increase

Quorum’s SaaS and BDC recurring revenue streams represented 97% of its total Q4 revenue

ADJUSTED EBITDA* and ADJUSTED CASH INCOME (ACI) *

• Quorum continued to tightly manage its cost structure and produced an Adjusted EBITDA of $1.3 million, or 15% of total revenue

• Adjusted Cash Income was $594 thousand

PRODUCT DEVELOPMENT• In January 2021 we announced:• Our re-platforming and data

consolidation project utilizing Microsoft Azure Synapse.

• The launch of our Windows Virtual Desktop pilot using the Microsoft Azure cloud platform for deploying XSellerator DMS (eliminating the need for on-premise solutions)

• In March 2021 we introduced enhancements to:• PowerLane – including mobile

check-in capability• MyDeal – including the ability for

customers to complete online payments for a vehicle deposit.

* Please refer to the “Non-GAAP Measures” and “Glossary of Terms” slides in the Appendix of this presentation for the meaning of this term or acronym.

May 26, 2021

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INCOME STATEMENT HIGHLIGHTS


* Please refer to the “Non-GAAP Measures” and “Glossary of Terms” slides in the Appendix of this presentation for the meaning of this term or acronym

May 26, 2021

($000’s except per share amounts)

Three Months Ended March 31, 2021

% of Revenue

Three Months Ended March 31, 2020

% of Revenue

Change 2021/2020

GrowthSaaS* revenue 6,101 71% 5,921 70% 3%BDC* revenue 2,187 26% 2,128 25% 3%Services and one-time revenue 268 3% 466 5% -42%Total Revenue 8,556 100% 8,515 100% 0.5%

ProfitabilitySaaS* gross margin 3,961 3,886 75 BDC* gross margin 215 232 (17) Services and one-time gross margin (406) (250) (156) Gross margin 3,770 3,868 (98)

SaaS* gross margin % 65% 66% -1%BDC* gross margin % 10% 11% -1%Services and one-time gross margin % -152% -54% -98%Gross margin % 44% 45% -1%

Research and development expense 329 4% 217 3% 112 Sales and marketing expense 884 10% 1106 13% (222) General and administrative expense 1,335 16% 1,697 20% (362)

Adjusted EBITDA* 1,291 15% 883 10% 408 Adjusted Cash Income (ACI)* 594 7% 52 1% 542

Weighted Average Shares Outstanding 72,810,391 72,231,173 579,218

Net income (loss) (309) (960) 651 Net income (loss) per share - basic (0.004) (0.013) 0.009 Net income (loss) per share - diluted (0.004) (0.013) 0.009

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BALANCE SHEET HIGHLIGHTS

MOST RECENT CAPITALIZATION EVENTS:

April 2021:• Prepayment of $1.5 million in principal and interest was made on the BDC Capital Loan Facility.

March 2019• Closed a $15 million debt financing facility with BDC Capital Inc. (the “BDC Capital Facility”).• The $8.1 million initial draw was used to retire the Bridge Loan used as a temporary measure to fund the purchase of DealerMine Inc. in late 2018 and pay the cash consideration

of the Oasis acquisition.

June 2019 • Closed a $1.5 million interest free, unsecured, repayable investment with the Atlantic Canada Opportunities Agency (“ACOA”) to assist with its Lead Generation Data Hub project.

November 2019• Closed an oversubscribed bought deal private placement offering of common shares. • Quorum issued 10,574,825 shares at a price of $0.87 per share for aggregate gross proceeds of $9.2 million.



May 26, 2021

($000’s except per share amounts)Three Months Ended

March 31, 2021Three Months Ended

March 31, 2020Net working capital 9,222 8,817Cash provided by operating activities 681 902

Cash and cash equivalents 9,222 8,466Total assets 49,776 50,255Non-current financial liabilities 12,995 12,832Total debt 9,923 9,133Net debt* 700 667Net debt*/Adjusted EBITDA* 54% 75%

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$5.5 $5.6 $5.8 $5.9$4.3

$5.9 $6.0 $6.1

$1.9 $1.9 $1.8 $2.1

$1.5

$1.9 $2.0 $2.2$0.8 $1.0 $1.1 $0.5

$0.1

$0.3 $0.3 $0.3$8.2 $8.6 $8.7 $8.5

$5.9

$8.1 $8.3 $8.6

12% 4% 2% (2%)

(30%)

36%

3% 3%

Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021

SaaS Revenue BDC RevenueServices & One-Time Revenue Revenue Growth (%)

$7.7

HISTORICAL FINANCIAL PERFORMANCE


BDC* GROSS MARGIN

REVENUE PROFITABILITY

Represents the $1.8 million in SaaS and BDC COVID-19 discounts that Quorum gave its dealership customers in April and May 2020.


May 26, 2021

$0.3 $0.3 $0.2$0.2

$0.3$0.2 $0.2

15%14%

(2%)

11% 11%

14%

9%10%

Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021

BDC Gross Margin SaaS Gross Margin % of SaaS Revenue

$-

$1,000

$2,000

$3,000

$4,000

Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021

Total Gross Margin Adjusted EBITDA* Adjusted Cash Income (ACI)*

$3.6 $3.8 $3.9 $3.9

$2.5

$3.7 $4.0 $4.0

66%67% 66% 66%

59%

62%

66% 65%

Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021

SaaS Gross Margin SaaS Gross Margin % of SaaS Revenue

SaaS* GROSS MARGIN

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MARKET DATA at MAY 21, 2020Capitalization Ownership Breakdown

Other Shareholders

Dealerships (Estimate)

Directors and Mgmt.

Latest FinancingNovember 2019

Shares Issued: 10.6 millionIssue Price: $0.87/shareGross Proceeds: $9.2 million

Placement:Institutional ownership is above 50% of totaloutstanding shares.

Share Price Performance (Last 12 Months)


Share Price at May 21, 2021 C$ $1.07

Basic Shares Outstanding MM 72.8RSUs Outstanding MM 0.5

Diluted Securities Outstanding MM 73.4

Diluted Market Capitalization at May 21, 2021 C$ MM $78.5At Year End December 31, 2020

- Cash Balance C$ MM ($9.2)+ Debt C$ MM $9.9+ Lease Liabilities C$ MM $3.2

Enterprise Value C$ MM $82.4

32%

10% 58%

Sources: S&P Capital IQ as at May 21, 2021

0

200

400

600

800

1,000

1,200

1,400

$0.40

$0.60

$0.80

$1.00

$1.20

$1.40

$1.60

May-20 Aug-20 Nov-20 Feb-21 May-21

Volu

me

(000

s)

Shar

e Pr

ice

(C$)

Volume (000s) Share Price (C$)

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LEADERSHIP TEAM

Maury Marks, CPA, CAPresident, Chief Executive Officer & Founder

Marilyn Bown, CPA, CGAChief Financial Officer

Dan Ichelson, MBASenior VP, Development

Rick JohnstonVP Product Management, Vehicle Sales

Mike HerenbergChief Operating Officer


Jane WebbVP Product Management, Vehicle Service

Mark BennettVP Sales & Marketing

May 26, 2021


Appendix

17

18

VALUATION & ANALYST COVERAGE

Quorum Share Price at May 21, 2021: $1.07/share

• Cormark Securities Inc.• Beacon Securities Limited

Current Average Sell Side Analyst Target Share Price: $1.73/share

Current Quorum Sell Side Analyst Coverage:

@2020 Quorum All rights reserved.@2021 Quorum. All rights reserved. 19


May 26, 2021

QUORUM at May 21, 2021

SEG SaaS Index: Public Market EV/TTM Revenue Multiple for

Q2 2021(in 000's) January Februray March

EV*/TTM Revenue Multiple 2.7x 14.2x 13.7x 15.3x 13.2xQuorum Enterprise Value at May 21, 2021 $82.4TTM Revenue $30.9

EV*/Annual Revenue Run Rate* Multiple 2.4xQuorum Enterprise Value at May 21, 2021 $82.4Q1 2021 ARR Run Rate*** $34.2

By Month

Software Equity Group (SEG) - 1Q21 Reportwww.softwareequity.com

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ACQUISITION HISTORY

Acquisition Date September 1, 2017 October 31, 2018 January 2, 2019Consideration Paid

Cash $ 875,000 $ 9,625,000 $ 485,000 Equity (QIS Common Shares)

Powerband Global Inc. (4,956,897 shares at $0.58/share) $ 2,875,000 Robert Quirion (2,586,207 shares at $0.58/share) $ 1,500,000 Scott Savage (78,125 shares at $0.64/share) $ 50,000 Keith Gubler (78,125 shares at $0.64 /share) $ 50,000

Earn-Out (Over Two Years) $ 600,000 Rick Johnston (540,000 RSU at $0.68/share) $ 367,200

Total Consideration Paid $ 1,242,200 $ 14,000,000 $ 1,185,000

TTM Revenue at September 30, 2017SaaS Revenue $ 392,000 Total Revenue $ 392,000

TTM Revenue at September 30, 2018SaaS Revenue $ 583,000 $ 6,960,000 $ 1,136,000 Service Revenue $ 4,791,000 One-Time Revenue $ 613,000 $ 35,000 Total Revenue $ 583,000 $ 12,364,000 $ 1,171,000


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GLOSSARY of ACRONYMS


The following is a list of acronyms used within this presentation and what they stand for:

ARR Annual Recurring RevenueARRPU Annual Recurring Revenue per UnitAV Autovance, a division of QuorumBDC Business Development Centre; a recurring revenue stream for QuorumCRM Customer Relationship Management, a Quorum software product solutionDM DealerMine, a division of QuorumEV Enterprise ValueER Enterprise Reporting, a Quorum software product solutionERP Enterprise Resource Planning, a Quorum software product solutionMRRPU Monthly Recurring Revenue per UnitROI Return on InvestmentSaaS Software as a Service; a recurring revenue stream for QuorumShares I&O Shares Issued & OutstandingSEG Software Equity Group (www.softwareequity.com)TAM Total Available MarketTTM Trailing Twelve MonthsXS XSellerator, a division of Quorum

May 26, 2021

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The following is a list and definition of the non-GAAP measures (NGMs) used within this presentation. A full reconciliation of these non-GAAP measures to their corresponding GAAP measures, as well as the stated usefulness of these non-GAAP measures can be found in Quorum’s Q4 2020 MD&A.

Adjusted EBITDA – Net income (loss) before interest and financing costs, taxes, depreciation, amortization, stock-based compensation, foreign exchange gains and losses, one-time acquisition-related expenses and restructuring fees. Management believes this measure is useful to investors as they best reflect the performance of the Corporation’s activities and allow for better comparability from period to period.

Adjusted Cash Income (or ACI) - Adjusted EBITDA less capitalized salaries and overhead. Management believes this measure is useful to investors as they best reflect the performance of the Corporation’s activities and allow for better comparability from period to period.

Net Debt – net debt calculated as total debt less cash. Management uses the net debt metric to monitor the Corporation’s financial leverage and believes that this metric is useful to investors as it provides insight into its financial strength.

Normalized Revenue - In Q2 2020 the term was used to reflect the Revenue in the Quarter plus the $1.8 million in SaaS and BDC COVID-19 discounts that Quorum gave its dealership customers in April and May 2020.

Annual Revenue Run Rate – this represents the total revenue in the last quarter of the current period, multiplied by 4.

Recurring Revenue – represented by adding SaaS and BDC revenue.

Annual Recurring Revenue (ARR) Run Rate – current reported quarter revenue multiplied by four for both SaaS and BDC revenue.

MRRPU (Monthly Recurring Revenue Per Unit) – total recurring revenue for a quarterly or annual period, divided into a monthly amount, and divided by the number of customers at the end of the period.

ARRPU (Annually Recurring Revenue Per Unit) – total annual recurring revenue divided by the number of customers at the end of the year.

NON-GAAP MEASURES


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Quorum’s Board of Directors brings Acquisition Experience in Various Verticals


BOARD OF DIRECTORS

Scot EisenfelderDirector• Senior VP of Strategy & Planning, EasyCare

Maury MarksDirector, President & CEO• Director, President & CEO, Quorum Information

Technologies Inc.

Joe CampbellDirector• President & CEO, Tricor Automotive Group,

Inc.

Neil McDonnellChair, Board of Directors• Chair, Photon Controls Inc.• Chair, Nanotech Security Corp.• Director, Redline Communications• Chair, BasicGov Systems

Greg PollardDirector• Chair, Audit & Finance Committee, Balancing Pool

Board of Directors

Jon HookDirector• Senior Analyst, Voss Capital LLC

William NurthenDirector• Chief Financial Officer, Endeavor Business Media

May 26, 2021

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Maury Marks, B. Mgt., CPA, CAPresident and Chief Executive OfficerTelephone: (403) 777-0036Website: www.QuorumDMS.com

Thank You

Quorum Q1 2021 Results Investor Presentation FINAL · 2021. 5. 26. · Quorum’s solutions...

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