Pluribus Technologies Corp. Enters into Binding Share Purchase Agreement to Acquire the Kesson Group

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Jan 25, 2022, 07:00 ET

Marks the Company's Sixth Acquisition in the Growing eLearning Market

TORONTO, Jan. 25, 2022 /PRNewswire/ - Pluribus Technologies Corp. (TSXV: PLRB) ("Pluribus" or the "Company"), a growing acquiror of small, profitable software companies, today announced that it has entered into a binding share purchase agreement (the "Share Purchase Agreement") pursuant to which it will acquire (the "Acquisition") all of the issued and outstanding shares of Kesson Group Inc. and Kesson Group Holdings Limited (collectively, the "Kesson Group").

The Kesson Group is headquartered in Toronto, Canada and has a strong history as a growing and profitable business with an established, nearly 20-year operating track record. The Kesson Group operates: Teach Away, a recruitment and professional development platform for international educators; Klassroom, which offers state-approved and U.S.-accredited teacher licensure programs that provide teachers an alternative pathway to a career in education through full certification and state licensing in certain jurisdictions; and Skooli, an online learning platform that offers tutoring options for K-12 school districts, not for profits, and corporations that want to support students with instant access to qualified teachers.

"Teach Away's network of 1.5 million educators, teacher licensing pathways and Skooli online learning platform are helping to fill global demand for well-trained and effective teachers that can thrive in an increasingly digital educational environment and provide the best possible experience for students," said Richard Adair, CEO of Pluribus Technologies. "We continue to identify and act on opportunities in the eLearning market with the acquisition of the Kesson Group being our sixth acquisition in the rapidly growing eLearning vertical. Kesson Group is our first acquisition focused on the K-12 education market and tenth overall since March 2019."

"The Kesson Group has grown steadily since our formation in 2003, and leveraging the experience, resources and operational synergies offered by Pluribus will allow us to enter our next phase of growth amidst strong demand for teachers around the world," said Rene Frey, President of Teach Away. "We are also seeing strong growth in demand for online tutoring globally across a variety of organizational types, driven in part by the ongoing COVID-19 pandemic, as well as for licensing pathways that can rapidly help meet the demand for teachers both in the U.S. and internationally."

Acquisition Rationale

The Kesson Group has a strong history as a growing and profitable business with an established operational track record;
There is growing demand for teachers globally, both online and in classroom, and critical shortages in a number of countries, including the U.S. (President Biden has earmarked $9 billion in proposed funding to address teacher shortages and training¹);
Demand for private and online tutoring is expected to continue to grow globally – the market for private tutoring in the U.S. was forecast at $24.9 billion in 2021²;

· Facilitates Pluribus' entry into the education market within the eLearning vertical; and

Potential customer and other cross-selling synergies with Pluribus' other eLearning businesses to a range of customer groups including corporations.

¹ Source: https://aacte.org/2021/04/aacte-applauds-president-bidens-9-billion-proposal-to-address-the-teacher-shortage/

² Source: StrategyR™ Private Tutoring – Global Market Trajectory and Analytics, May 2021.

Terms of the Acquisition

Pursuant to the terms of the Share Purchase Agreement, the Company has agreed to pay the current shareholders of the Kesson Group an aggregate of $10,000,000 in cash and issue 320,439 common shares of the Company and 5,000 common share purchase warrants, with each warrant exercisable to acquire one common share of the Company until January, 2024. In addition, the current Kesson Group shareholders will be entitled to an earn-out based on the achievement of future performance targets by the Kesson Group. The price paid for the acquisition falls within Pluribus' historical target range for Adjusted EBITDA³.

³ Adjusted EBITDA is a non-IFRS measure as described in the Non-IFRS Measures section of this news release.

The Acquisition is subject to customary closing conditions, including approval of the Acquisition by the TSXV and the other conditions set out in the Share Purchase Agreement. Subject to the satisfaction of such conditions, the Company expects to close the Acquisition on or about January 27, 2022.

The team behind Teach Away is a blend of accomplished executives in the education sector including Rene Frey, President of the Kesson Group and David Frey, CEO of the Kesson Group. Both Rene Frey and David Frey will remain involved in the Kesson Group post-Acquisition to ensure a smooth integration of the Kesson Group as part of the Pluribus portfolio.

About Kesson Group
At Kesson Group, we envision a world where every student experiences the power of a great teacher. With nearly 20 years of experience connecting great teachers with great schools across the globe, we are home to one of the largest communities of job-seeking educators.

Kesson Group provides aspiring teachers with new and affordable pathways to teacher licensure, and connects them directly with employment at top schools and districts through its hiring platform. The online tutoring platform, Skooli, leverages a network of job seeking teachers to provide districts with accessible tutoring solutions that are affordable and equitable.

About Pluribus Technologies Corp.
Pluribus is a technology company that acquires small, profitable business-to-business software companies at reasonable prices in a range of verticals and industries. Pluribus provides experienced sales and marketing resources, strategic partnerships and enabling technologies including automation, self-service and artificial intelligence/machine learning to create new revenue streams and enable companies to grow into significant organizations in their respective markets. For more information, please visit: https://www.pluribustechnologies.com/.

Non-IFRS Measures
The Company uses non-IFRS measures to assess its operating performance. Securities regulations require that companies caution readers that earnings and other measures adjusted to a basis other than IFRS do not have standardized meanings and are unlikely to be comparable to similar measures used by other companies. Accordingly, they should not be considered in isolation. The Company uses Adjusted EBITDA as a measure of operating performance. Therefore, Adjusted EBITDA may not be comparable to similar measures presented by other issuers. Adjusted EBITDA is calculated based on results from operating activities adjusted for depreciation of property and equipment and right-of-use assets, and acquisition related restructuring costs. Management uses Adjusted EBITDA to evaluate operating performance as it excludes amortization of software and intangibles (which is an accounting allocation of the cost of software and intangible assets arising on acquisition), any impact of finance and tax related activities, asset depreciation, foreign exchange gains and losses, other income and restructuring costs primarily related to acquisitions

Forward-Looking Information
Certain information in this press release constitutes forward-looking statements under applicable securities laws. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking information in this press release includes, but is not limited to, statements with respect to the business plans of the Company, including the successful completion and pace of future acquisitions, the Company management's expectation on the growth, profitability and performance of its current and future acquisitions, completion of the Acquisition and timing thereof, TSXV approval of the Acquisition, the Kesson Group's continued growth and profitability and ability to attract and train teachers, Rene Frey and David Frey's engagement by the Kesson Group following the closing of the Acquisition, the anticipated synergies between the Kesson Group and the Company, the Company's ability to continue acquiring business-to-business software companies at reasonable prices and the Company's ability to grow its portfolio companies into significant organizations. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "expect", "potential", "believe", "intend" or negatives of these terms and similar expressions.

Forward-looking statements are based on certain assumptions, including the Company's ability to complete acquisitions on favorable terms; the Company's ability to manage a complex portfolio of companies effectively; the Company's ability to scale its management team to support a rapid pace of growth; the Company's ability to raise sufficient financing to continue the pace of its acquisition strategy; the Company's ability to maintain its rapid pace of growth. Other assumptions include industry trends, the availability of growth opportunities, and general business, economic, competitive, political, regulatory and social uncertainties will not prevent the Company from conducting its business. While the Company considers these assumptions to be reasonable based on information currently available, they are inherently subject to significant business, economic and competitive uncertainties and contingencies and they may prove to be incorrect. Forward-looking information speaks only to such assumptions as of the date of this release.

Forward-looking statements also necessarily involve known and unknown risks, including without limitation, risks associated with general economic conditions, including the COVID-19 pandemic, adverse industry events, marketing costs, loss of markets, future legislative and regulatory developments, the inability to access sufficient capital on favourable terms, the Company's limited operating history; ability to complete favorable acquisitions; the software industry in Canada and internationally, income tax and regulatory matters, the ability of the Company to execute its business strategies, including the ability manage a complex portfolio of companies effectively, competition, currency and interest rate fluctuations, and other risks.

Readers are cautioned that the foregoing is not exhaustive. Readers are further cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ from those anticipated. Forward-looking statements are not guarantees of future performance. The purpose of forward-looking information is to provide the reader with a description of management's expectations, and such forward-looking information may not be appropriate for any other purpose. Except as required by law, the Company disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, events or otherwise. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

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.

SOURCE Pluribus Technologies Inc.