TORONTO, May 29, 2024 (GLOBE NEWSWIRE) -- CloudMD Software & Services Inc. (TSXV: DOC, Frankfurt: 6PH) (the "Company" or "CloudMD"), an innovative health services company transforming the delivery of care, is announcing that further to the Company's filing of its audited consolidated financial statements for the year ended December 31, 2023 and the related management's discussion and analysis, a revocation order has been granted by the Ontario Securities Commission in respect of the failure-to-file cease trade order, and trading of the common shares of the Company on the TSX Venture Exchange is expected to be reinstated as of market open on Monday, June 3, 2024.
As previously disclosed, the Company will be mailing an information circular to securityholders in advance of the meeting to be held on June 27, 2024, to consider and approve the go-private transaction with CPS Capital that was announced on May 15, 2024 (the "Transaction"). Securityholders are urged to read the information circular once available.
In advance of mailing the information circular, the Company wishes to confirm certain Transaction details. In particular, the Company would like to confirm that the Transaction has an implied total enterprise value of approximately $37 million. This includes the amount paid to holders of common shares and other convertible securities, and the repayment, on closing of the Transaction, of the senior secured credit facilities (the "Credit Facilities") which mature on June 25, 2024, and total approximately $17 million, as well as the assumption of other debt and liabilities totaling approximately $9 million.
The Company has been unable to generate positive cashflow from operations to support the business while making scheduled debt repayments, carrying the cost of redundant leases and fulfilling its financial obligations related to previous acquisitions. In addition, there were limited refinancing opportunities available to the Company at commercially reasonable rates and without onerous covenants. The Company entered into a forbearance agreement (the "Forbearance Agreement") with the secured lender in respect of the Credit Facilities, which provides the Company with a $2 million non-revolving term facility, so the Company had financial support during the period before closing of the Transaction. The Forbearance Agreement also provides for deferral of the scheduled principal repayments and requires bi-weekly cash flows to be overseen by a monitor that is an independent financial advisor. Additionally, the Company entered into an agreement with CPS Capital pursuant to which CPS Capital agreed to provide a $1 million bridge loan to the Company to support its liquidity needs during the period before closing of the Transaction.
The Transaction provides the capital to support the Company's business with specific consideration to all of the Company's stakeholders and was the best alternative available to ensure the ongoing viability of the Company. If the Transaction is not completed, the Company does not expect that there will be an alternative that would provide any value to the holders of CloudMD's equity securities.
The Company also confirms that Nathan Lane is an officer of the Company, his appointment as Executive Vice President, Health & Productivity Solutions and US Operations having been confirmed by the Board on December 14, 2023.
About CloudMD
CloudMD is an innovative North American healthcare service provider focused on empowering healthier living by combining leading edge technology with an exceptional national network of healthcare professionals. Every day, our employees and health care providers live our values of delivering excellence, collaboration, connected communication and accountability to solve complex health problems. CloudMD's industry leading workplace health and wellbeing solution, Kii, supports members and their families with a personalized and connected healthcare experience across mental, physical and occupation health. Kii delivers superior clinical health outcomes, consistent high engagement, and measurable ROI for payers such as employers, educational institutions, associations, government, and insurers. CloudMD is also a market leader in workplace absence management through data-driven prevention, intervention and return to work programs.
In addition, the Company sells health and productivity tools to hospitals, clinics, and other healthcare service providers to empower them to deliver better care. Visit www.cloudmd.ca to learn more about the Company's comprehensive healthcare offerings.
"Karen Adams"
Chief Executive Officer
FOR ADDITIONAL INFORMATION, CONTACT:
Investor Relations
Investors@cloudmd.ca
1-647-484-1405
Neither 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 contains "forward-looking statements" and "forward-looking information" within the meaning of Canadian securities laws, including statements relating to the Transaction, including in respect of the impact of the Transaction, the anticipated meeting date and mailing of the information circular in respect of the meeting, timing for completion of the Transaction and receiving the required regulatory and court approvals, CloudMD's expectations regarding liquidity and continuity of the Company's business and operations, the availability of the bridge loan and line of credit and continued forbearance through the period until closing of the Transaction, and the timing of the resumption of trading on the TSXV. All information that is not clearly historical in nature may constitute forward-looking statements. In some cases, forward-looking statements may be identified by the use of terms such as "forecast", "projected", "assumption" and other similar expressions or future or conditional terms such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will", "would", and "should". Forward-looking statements contained in this news release are based on certain factors and assumptions made by management of CloudMD based on their current expectations, estimates, projections, assumptions and beliefs regarding their business and CloudMD does not provide any assurance that actual results will meet management's expectations. While management considers these assumptions to be reasonable based on information currently available to them, they may prove to be incorrect. Such forward-looking statements are not guarantees of future events or performance and by their nature involve known and unknown risks, uncertainties and other factors, including those risks described in the Company's MD&A (which is filed under the Company's issuer profile on SEDAR+ and can be accessed at www.sedarplus.ca), that may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Although CloudMD has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, other factors may cause actions, events or results to be different than anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could vary or differ materially from those anticipated in such forward-looking statements. Accordingly, readers should not place undue reliance on forward-looking information. CloudMD does not undertake to update any forward-looking information, whether as a result of new information or future events or otherwise, except as may be required by applicable securities laws.
