Loyalist to Acquire Largest Agency in South Korean

TORONTO, ONTARIO--(Marketwired - Nov. 24, 2014) - Loyalist Group Limited ("Loyalist", the "Company") (TSX VENTURE:LOY) is pleased to announce that it has entered into a definitive agreement to acquire all the shares of Uhak.com ("Uhak"), a South Korean based student recruiting agency, providing information and registration services to South Korean students looking to study abroad.

Uhak had consolidated revenue of $10.3 million, representing student tuition fees of approximately $40 million, and adjusted net income of $1.0 million (EBITDA $1.2 million) in the 12-month period ended December 2013.

"This acquisition adds a new dimension to Loyalist's vertical integration strategy," said Chief Executive Officer Andrew Ryu. "By acquiring one of our largest agency partners, we will be in a position to reduce our direct costs of attracting students, as well as strengthening ourselves a source for growing our student population, with an expected annualized additional net benefit of approximately $2.0 million within the first year. We look forward to welcoming the Uhak team into the Loyalist family."

Loyalist will pay $8.1 million for Uhak, of which $5.3 million will be paid in cash, subject to certain closing adjustments, and $2.8 million will be paid through the issuance of 5,384,615 Loyalist common shares at a price of $0.52 per share, with $2.2 million of such shares being held in escrow for a period up to 24 months following closing as security for certain defined post-closing adjustments. The parties expect to complete the transaction on or around December 5, 2014.

Mr. Ryu also stated "It should be noted that students do not necessarily have to attend one of our schools for Loyalist to benefit from students going overseas to study, as we will share in the commission fees for students who might choose to attend a school in another country (for example Australia, the USA or England)".

Completion of the transaction is subject to certain conditions including, but not limited to, the receipt of all necessary approvals, including the approval of the TSX Venture Exchange and the Bank of Korea.

About Uhak

Ukak.com is the largest South Korean based education information and counseling center, with eight branch offices in South Korea and overseas offices in Canada, the United States, England, Australia, New Zealand, and the Philippines.

About Loyalist

Loyalist Group Limited owns and operates private English as a Second Language (ESL) Schools, Career Colleges and Community Colleges in Toronto, Vancouver, Victoria and Halifax.

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

Forward-Looking Statements

This news release includes certain forward-looking statements within the meaning of Canadian securities laws. Such forward-looking information and statements are not representative of historical facts or information or current condition, but instead represent only the Company's beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of the Company's control. Generally, such forward-looking information or statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or may contain statements that certain actions, events or results "may", "could", "would", "might" or "will be taken, "will continue", "will occur" or "will be achieved". The forward-looking information contained herein includes information relating to the Company's proposed acquisition of Uhak and the financial impact of the acquisition, if completed, on the Company. By identifying such information and statements in this manner, the Company is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such information and statements. Any number of important factors could cause actual results to differ materially from these forward-looking statements as well as future results, including but not limited to: risks related to any of the Company's announced or proposed acquisitions failing to close or becoming delayed before closing; the Company 's reliance on its South Korean contract; carrying on business and activities in international jurisdiction where Canadian laws do not apply; the Company's ability to service its outstanding indebtedness and the impact of that indebtedness on the Company's ability to raise additional capital, fund operations or meet business objectives; any loss of certain key personnel; levels of student enrolment; delays in rolling out the online education programs; competition in the educational services market; and currency fluctuations. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in the forward-looking information and statements, there may be other factors that cause results not to be as anticipated, estimated or intended.
Although the Company believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. Accordingly, readers should not place undue reliance on any forward-looking information or statements contained in this press release. The forward-looking information contained in this press release is made as of the date hereof, and the Company does not undertake to update any forward-looking information that is contained or referenced herein, whether as a result of new information, future events or otherwise, except in accordance with applicable securities laws. All subsequent written and oral forward looking information and statements attributable to the Company or persons acting on its behalf is expressly qualified in its entirety by this notice.