Subsequent Event- Geneva Consulting Group Acquisition

3 Months Ended

Aug. 31, 2020

Subsequent Events [Abstract]

Subsequent Event- Geneva Consulting Group Acquisition

15. Subsequent Event- Geneva Consulting Group Acquisition

On September 1, 2020, the Company completed the acquisition of all of the outstanding stock of Geneva Consulting Group, Inc., a New York corporation (“Geneva”) and provider of temporary and permanent information technology personnel based in Port Washington, New York. The stock of Geneva was purchased from the three shareholders of Geneva (the “Sellers”), none of which had, or will have following the acquisition, a material relationship with the Company or its affiliates.

The purchase price for the shares of Geneva is comprised of the following: (i) $1.45 million in cash paid to Sellers at the closing of the acquisition, (ii) an amount, up to $0.75 million, that is equal to the amount of Geneva’s loan under the PPP that is forgiven by the SBA, (iii) an amount, up to $0.30 million which may be paid as an earnout payment in part in February 2021 and in part in August 2021 (the “Earnout Payments”) and (iv) bonus payments payable in $10,000 increments. Any such Earnout Payments and bonus payments will be determined based upon the achievement of certain criteria relating to the number the Company’s contractors working full-time at Company clients on such dates.

The Company has incurred approximately $300,000 in legal fees, business broker fees, valuation services, accounting fees and other expenses to complete the Geneva acquisition, of which $122,000 of these expenses were recorded in the quarter ended August 31, 2020.