DE Decisive Dividend Corporation

Decisive Dividend Corporation (TSX-V: DE) (the “Corporation” or “Decisive”) is pleased to announce the acquisition (the “Acquisitions”) of three businesses for $17.2 million in aggregate proceeds. The Corporation has acquired, from arm’s length parties, four legal entities as follows: Capital I Industries Inc. and its sister company, Irving Machine Inc. (together, “Capital I”), Micon Industries Ltd. (“Micon”) and Procore International Radiators Ltd. (“Procore”, and collectively with Capital I and Micon, the “Acquired Companies”). The Acquired Companies manufacture and sell a range of products that support non-cyclical road maintenance and construction customers, as well as heavy equipment maintenance customers across multiple industries and geographies.

Decisive is also pleased to announce that it has entered into an equity financing agreement pursuant to which Eight Capital and Cormark Securities Inc., as joint bookrunners and co-lead underwriters, together with a syndicate of underwriters (collectively, the "Underwriters"), have agreed to purchase, on a bought deal basis, 1,354,000 units of the Corporation (the “Units”) at a price of $5.91 per Unit (the “Issue Price”) for aggregate gross proceeds of $8,002,140 (the “Bought Deal Equity Financing”). Further details on the Bought Deal Equity Financing are provided below.

Highlights of Acquisitions

• Fully Funded: Fully funded through the proceeds of the concurrent Bought Deal Equity Financing and drawdown on the Corporation’s $15.0 million revolving term acquisition facility (the “Acquisition Facility”).
• Earnings growth and accretion: Expected to be immediately accretive to the business and represent on a pro forma basis an aggregate increase to the Corporation’s 2022 Pro Forma(4) sales of 13%, Adjusted EBITDA(1) of 30% and Adjusted EBITDA(1) per share of 17%.
• Revenue synergies: Several of the Corporation’s existing subsidiaries sell products to these same customers and industries (including the subsidiaries Unicast, Slimline, Northside and Hawk), resulting in potential synergistic selling opportunities (synergies not included in amounts disclosed in this press release).
• Resilient industries: Management believes that the industries served by the Acquired Companies have strong underlying fundamentals and are being supported by programs such as infrastructure spending bills and mining industry investment.
• Attractive multiples: Base purchase price of each Acquired Company represents a multiple below five times the average Adjusted EBITDA of the Acquisitions over the last five years.

The Acquired Companies

Capital I, located in Tisdale, Saskatchewan, designs, manufactures and distributes high-quality road maintenance and construction equipment. Capital I’s innovative products include dozer blades, snow blades and wings, slopers, gravel reclaimers, gravel groomers, lifts, mulchers and mowers, that are used in the construction and maintenance of gravel roads. Capital I’s products are tailored to fit numerous makes and models of heavy equipment used in road maintenance which allows them to service a diverse customer base ranging from OEMs, dealers and municipalities. In addition, excess manufacturing capacity is used to fabricate parts for various mining, oil and gas and agricultural customers.

Micon, located in Merritt, British Columbia, designs, manufactures and distributes high-quality radiator seals and grommets for heavy duty equipment. Its products are designed to help reduce downtime associated with cooling system failures of the equipment used in the demanding mining and road construction industries. Micon utilizes strategic distribution hubs and distribution partners to reduce time to fulfill orders to its worldwide base of customers.

Procore, located in Merritt, British Columbia, designs, manufactures and distributes high-performance radiators for heavy duty equipment. Procore radiators are designed for the cooling systems found in the heavy-duty equipment used in the mining, oil and gas and road construction industries. Procore manufactures a full line of folded core radiators as well as a growing list of AMOCS Radiators to fit into Caterpillar™ type equipment. Procore’s innovative designs reduce expensive downtime for its customers, and it utilizes strategic distribution hubs and distribution partners to reduce time to fulfill orders to its worldwide base of customers.

The founders of the three businesses acquired will continue to lead their respective businesses for the near term and each have contractual commitments to support succession planning in the Acquired Companies.

The Acquisitions are anticipated to be immediately financially accretive to Decisive and are expected to result in an increase in sales, gross profit, profit, Adjusted EBITDA(1), and Adjusted EBITDA per common share of Decisive (each, a “Common Share”). The Acquisitions are subject to the terms and conditions of three separate share purchase agreements which provide for an aggregate base purchase price of $17.2 million, subject to customary adjustments, plus up to an additional $4.5 million contingent on Capital I achieving certain earnings targets over the next three years. The base purchase price of each Acquired Company reflects the historical earnings of the Acquisitions and in each case represents a multiple below five times the average Adjusted EBITDA of the Acquisitions over the last five years.

On closing of the Acquisitions, the aggregate $17.2 million base purchase price, plus upward adjustments of $0.2 million for working capital in excess of negotiated targets (subject to adjustment), was paid $15.0 million in cash (the “Cash Consideration”), the assumption of $0.6 million in equipment financing, and $1.8 million in Common Shares (the “Share Consideration”). The Cash Consideration was initially funded using the Corporation’s $15.0 million Acquisition Facility. The Corporation intends to repay approximately $7.3 million of the Acquisition Facility using the net proceeds of the Bought Deal Equity Financing, providing ample liquidity for future acquisitions. The Share Consideration was funded through the issuance of 268,577 Common Shares (representing $1.8 million divided by $6.84, being the volume weighted average trading price of the Common Shares for the 10-day trading period ended April 4, 2023).

Bought Deal Equity Financing

The Underwriters have entered into an agreement to purchase, on a bought deal basis, 1,354,000 Units at the Issue Price for aggregate gross proceeds of $5.91. Each Unit will be comprised of one Common Share, and one-half of one Common Share purchase warrant. Each whole warrant shall entitle the holder thereof to purchase one Common Share at an exercise price of $7.09, for a period of 24 months following the closing of the Bought Deal Equity Financing.

The Corporation has granted the Underwriters an over-allotment option to purchase up to an additional 15% of the Units at the Issue Price, or the individual components thereof, exercisable in whole or in part, at any time on or prior to the date that is 30 days following the closing of the Bought Deal Equity Financing.

The Bought Deal Equity Financing will be completed by way of a prospectus supplement (the “Supplement”) to the short form base shelf prospectus of the Corporation dated November 30, 2022 (the “Base Prospectus”), which Supplement is expected to be filed on or prior to April 10, 2023 with the securities commissions and other similar regulatory authorities in each of the provinces and territories of Canada, other than Quebec, and in such other jurisdictions as are agreed to by the Corporation and the Underwriters, in each case provided that no prospectus, registration statement or other similar document is required to be filed in such jurisdiction and that the Corporation will not be or become subject to any continuous disclosure obligations in such jurisdiction. The Base Prospectus and, once filed, the Supplement can be found on SEDAR at www.sedar.com, and contain important detailed information about the Bought Deal Equity Financing.

The Corporation expects that, pursuant to the terms of an investor rights agreement between the Corporation and Waratah Capital Advisors Ltd. (“Waratah”) dated September 27, 2022, certain investment funds managed by Waratah will participate in the Bought Deal Equity Financing to maintain Waratah’s aggregate pro rata ownership percentage of Common Shares. Funds managed by Waratah currently hold 14% of the outstanding Common Shares.

In consideration for the services to be provided by the Underwriters, the Corporation has also agreed to pay the Underwriters a cash commission equal to 6.5% of the aggregate gross proceeds of the Bought Deal Equity Financing (except as it relates to purchasers identified on the President’s List, for which the cash commission will be reduced to 3.25%), including proceeds received from the exercise of the over-allotment option.

The closing date of the Bought Deal Equity Financing is scheduled to be on or about April 13, 2023, and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals, including the approval of the TSX Venture Exchange.

Jeff Schellenberg, Chief Executive Officer of Decisive, noted:

“Today’s announcement of the Acquisitions and Bought Deal Equity Financing are extremely important developments in the ongoing story of growth and yield being written by Decisive and are on point with the direction we have articulated to the market. The Acquired Companies’ exiting, legacy-minded business owners care very deeply about their companies’ and employees’ future success. We are honoured to be entrusted with the opportunity to both preserve and build off the legacy of these vendors as owners of these businesses into the future. Further, we are pleased to be able to add businesses that produce high margin proprietary products and have customers our existing subsidiaries are already selling to in the heavy equipment, mining and oil and gas industries. Adding on businesses with this financial profile, that sell into industries we already service is a strategic priority for Decisive, and these acquisitions fit our business strategy extremely effectively.

Further, being able to announce a bought deal financing supported by our underwriters is a significant milestone for Decisive and, along with the financing we will have available under our credit facilities moving forward, is a very positive indicator of our ability to fund future deals and continue our growth trajectory consistent with our 50/50 long-term debt and equity funding target.

Finally, with this announcement, Decisive has acquired five businesses in the last 12 months, added over $9.5 million of Adjusted EBITDA to our portfolio and increased Adjusted EBITDA per Common Share by 50%, all while also returning $4.9 million to our shareholders in the form of dividends, demonstrating how accretive our acquisition-focused growth and yield strategy is for our shareholders. As we look into the future, we continue to see significant opportunities to continue this trajectory, supporting value creation for all of our stakeholders.”

The table below sets forth the pro forma combined financial information of Decisive and the Acquisitions for the trailing twelve-month period ended December 31, 2022:

(Stated in thousands of dollars, except per share amounts)			Add				Add
			MIL & ACR(3)				Acquired
	Decisive(2)		pre-acquisition		2022		Companies(5)		Total
For the period ended December 31, 2022	Year		periods		Pro Forma(4)		12-Months		Pro forma
	(audited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
Sales	98,587		11,303		109,890		14,631		124,521
Gross profit	32,853		3,736		36,589		7,321		43,910
Gross profit %	33	%	33	%	33	%	50	%	35	%
Profit	4,084		1,522		5,606		3,716		9,322
Per share basic	0.31				0.38				0.57
Adjusted EBITDA(1)	13,667		2,156		15,823		4,757		20,580
Per share basic	1.05				1.08				1.27

(1) Adjusted EBITDA is not a recognized financial measure under International Financial Reporting Standards (IFRS) and therefore may not be comparable to similar measures presented by other issuers, but it is used by management to assess the performance of the Corporation. See ”Non-GAAP Financial Measures” later in this press release for the full description of Adjusted EBITDA and a reconciliation of applicable IFRS measures to non-IFRS measures.(2) Based on Decisive’s audited financial information for the year ended December 31, 2022.(3) Based on Marketing Impact Limited’s (“MIL”) unaudited financial information for the pre-acquisition period from January 1, 2022 to April 14, 2022 combined with ACR Heat Products Limited’s (“ACR”) unaudited financial information for the pre-acquisition period from January 1, 2022 to October 2, 2022. See “Information Relating to the Acquisitions” later in this press release.(4) The 2022 Pro Forma amounts are based on Decisive’s audited financial information for the year ended December 31, 2022, combined with the financial information for the pre-acquisition periods of MIL and ACR described in (3) above.(5) Based on the Acquired Companies aggregate unaudited financial information for the period from January 1, 2022 to December 31, 2022. See “Information Relating to the Acquisitions” later in this press release.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in the United States or in any other jurisdiction in which such offer, solicitation or sale would be unlawful. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the United States Securities Act of 1933, as amended, and applicable state securities laws.

About Decisive Dividend Corporation

Decisive Dividend Corporation is an acquisition-oriented company, focused on opportunities in manufacturing. The Corporation’s purpose is to be the sought-out choice for exiting legacy-minded business owners, while supporting the long-term success of the businesses acquired, and through that, creating sustainable and growing shareholder returns. The Corporation uses a disciplined acquisition strategy to identify already profitable, well-established, high quality manufacturing companies that have a sustainable competitive advantage, a focus on non-discretionary products, steady cash flows, growth potential and established, strong leadership.

For more information on Decisive, or to sign up for email notifications of Corporation press releases, please visit www.decisivedividend.com.

FOR FURTHER INFORMATION PLEASE CONTACT:

Jeff Schellenberg, Chief Executive Officer #260 – 1855 Kirschner RoadKelowna, BC V1Y 4N7Telephone: (250) 870-9146

Cautionary Statements

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

Information Relating to the Acquisitions

This press release contains certain information (including historical financial information) relating to the Acquisitions as well as pre-acquisition historical financial information relating to MIL and ACR. The information (including financial information) contained herein with respect to the Acquisitions, as well as pre-acquisition historical financial information relating to MIL and ACR, is based upon information provided to Decisive by the Acquired Companies, MIL, and ACR, and their respective management and previous shareholders and includes certain non-recurring and related party private company transactions that have been excluded from the calculation of Adjusted EBITDA below. The financial information relating to the Acquisitions and the Acquired Companies, as well as pre-acquisition historical financial information relating to MIL and ACR, has not been audited.

Non-GAAP Financial Measures

In this press release, reference is made to “Adjusted EBITDA”, which is not a recognized financial measure under IFRS, but is believed to be meaningful in the assessment of the Corporation’s performance.

“Adjusted EBITDA” is defined as earnings before finance costs, income taxes, depreciation, amortization, foreign exchange gains or losses, other non-cash items such as gains or losses recognized on the fair value of contingent consideration items, asset impairment, share-based compensation, and restructuring costs, and other non-operating items such as acquisition costs.

Adjusted EBITDA is a financial performance measure that management believes is useful for investors to analyze the results of the Corporation’s operating activities prior to consideration of how those activities are financed and the impact of non-operating charges related to planned or completed acquisitions, foreign exchange, taxation, depreciation, amortization, and impairment charges.

The most directly comparable financial measure is profit or loss. Adjusted EBITDA per Common Share is also presented, which is calculated by dividing Adjusted EBITDA, as defined above, by the weighted average number of Common Shares outstanding during the period.

While Adjusted EBITDA is used by management to assess the historical financial performance of the Corporation, readers are cautioned that:

• Non-IFRS financial measures, such as Adjusted EBITDA, are not recognized financial measures under IFRS;
• The Corporation’s method of calculating Non-IFRS financial measures, such as Adjusted EBITDA, may differ from that of other corporations or entities and therefore may not be directly comparable to measures utilized by other corporations or entities;
• Non-IFRS financial measures, such as Adjusted EBITDA, should not be viewed as an alternative to measures that are recognized under IFRS such as profit or loss or cash from operating activities; and
• A reader should not place undue reliance on any Non-IFRS financial measures.

Set forth below are reconciliations of Non-IFRS financial measures to their most relevant IFRS measures.

(Stated in thousands of dollars)			Add				Add
			MIL & ACR(3)				Acquired
	Decisive(2)		pre-acquisition		2022		Companies(5)		Total
For the period ended December 31, 2022	Year		periods		Pro forma(4)		12-Months		Pro forma
	(audited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
Profit	4,084		1,522		5,606		3,716		9,322
Add (deduct):
Financing costs	2,524		29		2,553		25		2,578
Income tax expense (recovery)	1,603		341		1,944		858		2,802
Amortization and depreciation	4,884		62		4,946		414		5,360
Acquisition costs & restructuring costs	1,077		-		1,077		-		1,077
Inventory fair value adjustments	22		250		272		-		272
Share-based compensation expense	143		-		143		-		143
Foreign exchange expense (income)	(619	)	(45	)	(664	)	81		(583	)
Interest and other income	(20	)	(2	)	(22	)	(22	)	(44	)
Gain on sale of equipment	(31	)	(1	)	(32	)	(389	)	(421	)
Non-recurring transactions	-		-		-		74		74
Adjusted EBITDA	13,667		2,156		15,823		4,757		20,580

Forward-Looking Statements

Certain statements contained in this press release constitute forward-looking information. These statements relate to future events or future performance. The use of any of the words “could”, “intend”, “expect”, “believe”, “will”, “projected”, “estimated” and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on management’s current beliefs, assumptions and expectations as to the outcome and timing of such future events. Actual future results may differ materially. In particular, this press release contains forward-looking information relating to the future financial position, operations, business strategy, plans and objectives of the Corporation, and the potential impact, including growth expectations, of the Acquisitions on the operations, financial condition, capital resources, business and dividend policy of the Corporation. Risk factors that could cause actual results or outcomes to differ materially from the results expressed or implied by forward-looking information include, among other things: risks relating to acquisitions (as more particularly described under the heading "Risk Factors – Risk Related to Acquisitions" in the Corporation's most recent annual information form), as well as general economic conditions; pandemics; competition; government regulation; environmental regulation; access to capital; market trends and innovation; climate risk; general uninsured losses; risk related to acquisitions generally; dependence on customers, distributors and strategic relationships; supply and cost of raw materials and purchased parts; operational performance and growth; implementation of the growth strategy; product liability and warranty claims; litigation; reliance on technology, intellectual property, and information systems; availability of future financing; interest rates and debt financing; income tax matters; foreign exchange; dividends; trading volatility of Common Shares; dilution risk; reliance on management and key personnel; employee and labour relations; and conflicts of interest, all as more particularly described in the most recent annual MD&A and annual information form of the Corporation available on the Corporation’s profile at www.sedar.com. There can be no assurance as to the future financial performance of the Corporation or that the board of directors of the Corporation will declare or pay any dividends in the future or, if dividends are declared and paid, there can be no assurance as to the frequency or amount of such dividends. The Corporation cautions the reader that the risk factors referenced above are not exhaustive. The forward-looking information contained in this release is made as of the date hereof and the Corporation is not obligated to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Because of the risks, uncertainties and assumptions contained herein, investors should not place undue reliance on forward-looking information. The foregoing statements expressly qualify any forward-looking information contained herein.

Not for distribution in the United States

This press release is not for distribution to U.S. Newswire Services or for dissemination in the United States. Any failure to comply with this restriction may constitute a violation of U.S. Securities laws.