You simply need to save your Excel spreadsheet in a tab-delimited text format, then use the text import feature of Now Contact to bring in the records.

Page 132 and 133 of the "Take Control of Now Up-to-Date & Contact" manual covers importing text files.

You may find that the version 4 manual covers importing in a little more depth, the information in this manual is still relevant to version 5 as text import did not change between the two versions. The information on importing starts on page 149 of the version 4 manual, and you can download a copy of it in PDF format here:

You may also find useful information in the FAQ on importing trouble here:

This talks about common issues that might show up when importing. Especially note that there is a 64 field per record limit on importing in Now Contact, so make sure you don't have more than 64 columns of data in your excel spreadsheet.
Sean Boiarski
Product Manager, Now Software