- Funding provided by a ~$1.8
million non-convertible loan from Beedie Capital
- Material dilution avoided and cash balance
protected
- Deferred consideration is associated with both BioPharma and
MDBriefcase acquisitions
- Grants RSU equity to non-executive directors according to
the Omnibus Equity Inventive Plan (OEIP)
TORONTO, June 12,
2023 /CNW/ - Think Research Corporation (TSXV: THNK)
("Think" or the "Company"), a company focused on
transforming healthcare through digital health software solutions,
is pleased to announce that it is paying certain deferred
consideration payments owing to the sellers of acquired companies
Bio Pharma Services Inc. ("BioPharma") and MDBriefcase Group
Inc. ("MDBriefcase"), in cash. Think is using the
proceeds from a new ~$1.8 million
loan (the "Loan") from Beedie Investments Ltd. ("Beedie
Capital"), pursuant to its Credit Agreement with Beedie Capital
(the "Credit Agreement"). By paying in cash, Think avoids
potentially material dilution that would otherwise occur with
payment by way of the issuance of Think common shares, as well as
takes advantage of certain negotiated discounts available for cash
payments.
Deferred Consideration
Payments
Further to the Company's press release of December 30, 2022, the sellers of MDBriefcase
(the "MDB Sellers") are entitled to certain deferred
consideration, which may be paid in the form of cash and/or shares,
at the option of the Company. The MDB Sellers agreed to defer
the instalment due to them on May 31,
2023 to June 12, 2023, and the
Company will pay today the amount owed of $985,829 in cash, using the proceeds of the
Loan.
As outlined in the Company's press release of October 14, 2022, the sellers of BioPharma (the
"BioPharma Sellers") are also entitled to certain deferred
consideration payments, payable in cash or shares, at the option of
the Company. Furthermore, payments in cash are subject to certain
discounts depending upon the amount. The Company is paying
the next instalment of deferred consideration to the BioPharma
Sellers today, in the amount of $800,000 in cash, again using the proceeds of the
Loan.
By paying the above amounts in cash, the Company avoided
significant dilution that would have otherwise resulted from
payment of the deferred considering owing to the MDB Sellers and
BioPharma Sellers in Think common shares, as well as saved
approximately $288,000 due to
previously negotiated cash payment discounts.
The Company will determine in the future how best to pay any
further deferred and/or earn out payments which may become due.
Loan
To fund such deferred payments, Think has received the Loan in
the amount of $1,785,829, pursuant to
the Credit Agreement and certain material amendments (the
"Amendments") that have been made to the Credit Agreement to
govern the terms of such Loan as follows:
- The Loan shall be used by Think to pay the instalment of
deferred consideration due to the BioPharma Sellers on June 10, 2023 and the contingent consideration
due to the MDB Sellers due on June 12,
2023.
- Unlike other advances under the Credit Agreement, the Loan will
not be convertible into shares of Think.
- The outstanding principal amount of the Loan shall bear
interest at a rate of 14% per annum calculated and payable as
follows: (i) interest at a rate of 7.0% per annum shall be
calculated daily and compounded monthly in arrears on the last day
of each month and shall accrue and be payable (including compound
interest) on a quarterly basis, and (ii) interest at a rate of 7.0%
per annum shall be calculated daily and compounded monthly in
arrears on the last day of each month and shall be added to the
outstanding principal amount of the Loan at the end of each
month.
- A commitment fee shall also be payable by Think to Beedie
Capital (the "Commitment Fee"), which shall be added to the
principal amount of the Loan.
- The Loan together with all outstanding and unpaid interest
thereon (including, for greater certainty, the Commitment Fee)
shall be due and payable on September 20,
2024.
- Think may make a voluntary prepayment in whole of the Loan at
any time by paying to Beedie Capital the outstanding principal
amount of the Loan (including, for greater certainty, the
Commitment Fee), together with any unpaid interest and, if the
prepayment occurs on or prior to the date that is four months
following the date of advance of the Loan, a make-whole fee.
"We continue to be impressed with Think's ability to deliver on
its strategic initiatives and are happy to support the Company in
flexible and accretive ways to drive long-term enterprise
value," said David Bell,
Managing Director at Beedie Capital. "We are confident
management will continue to lead the market in delivering
technology to strengthen health systems in Canada and internationally with its Digital
Front Door and Learning Management solutions"
Sachin Aggarwal, CEO of Think
said "The cash discount available for the deferred consideration
payments, combined with avoiding sizable dilution given the current
trading price of Think's shares, led us to conclude that using debt
to fund the upcoming payments was prudent despite the leverage on
Think's balance sheet. We greatly appreciate the continued support
of all shareholders as we work towards positive operating cash
flow."
Related Party
Transaction
Beedie Capital is a "related party" of the Company as defined in
Multilateral Instrument 61-101 – Protection of Minority
Security Holders in Special Transactions ("MI
61-101"), and the amendments would constitute a "related party
transaction" as defined in MI 61-101 and within the meaning of TSXV
Policy 5.9. The Company is relying on the exemptions from the
valuation and minority shareholder approval requirements of MI
61-101 contained in sections 5.5(a) and (b) and 5.7(1)(f) of MI
61-101.
Think Grants Equity to
Directors
On June 6, 2023, Think granted
264,744 deferred share units (each, an "DSU") and 331,813
restricted share units (each, an "RSU") to certain non-executive
directors of the Company pursuant to the Company's Omnibus Equity
Incentive Plan ("OEIP"). All DSUs and RSUs will vest on
June 6, 2024.
About Think Research
Corporation
Think Research Corporation is an industry leader in delivering
knowledge-based digital health software solutions. The Company's
focused mission is to organize the world's health knowledge so
everyone gets the best care. Its evidence-based healthcare
technology solutions support the clinical decision-making process
and standardization of care to facilitate better health care
outcomes. The Company gathers, develops, and delivers
knowledge-based solutions globally to customers including
enterprise clients, hospitals, health regions, healthcare
professionals, and / or governments. The Company has gathered a
significant amount of data by building its repository of knowledge
through its network and group of companies.
Think licenses its solutions to over 14,200 facilities for over
320,000 primary care, acute care, and long-term care doctors,
nurses and pharmacists that rely on the content and data provided
by Think to support their practices. Millions of patients and
residents annually receive better care due to the essential data
that Think produces, manages and delivers.
In addition, the Company collects and manages pharmaceutical and
clinical trial data via its BioPharma Services subsidiary.
BioPharma Services is a leading provider of bioequivalence and
Phase 1 clinical research services to pharmaceutical companies
globally. Think's other services include a network of digital-first
primary care clinics and medical clinics that provide elective
surgery. Visit www.thinkresearch.com
About Beedie Capital
Beedie Capital is a multi-strategy direct investment platform
that manages the alternative investments and assets for Beedie, one
of the largest private companies in British Columbia. It
deploys capital using a flexible, evergreen mandate, and applies a
highly agnostic approach to the duration, structure and size of its
investments. Beedie Capital provides its partners the time to
deliver on their strategic plans, while providing capital in the
right structure to optimize cost of capital and shareholder
return.
Beedie Capital invests in any sector, with a core focus on
Technology, Tech-enabled Services, and Metals and Mining, and seeks
to grow its invested capital alongside the enterprise value of its
investments. Visit: www.beedie.ca/capital
Caution Regarding Forward Looking
Information
This press release contains "forward-looking information" within
the meaning of applicable securities laws. Forward-looking
information may be identified by statements including words such
as: "believe", "expect," "likely," "may," "to be," "could,",
"would," "should," "will" and similar references to future periods
or the negative or comparable terminology, as well as terms usually
used in the future and the conditional. Statements including
forward-looking information may include, without limitation,
statements regarding the payment of amounts due to the sellers of
BioPharma and MDBriefcase, respectively.
Forward-looking information reflects management's current
beliefs and is based on assumptions that may prove to be incorrect.
The Company considers these assumptions to be reasonable in the
circumstances. However, there can be no assurance that such
assumptions will reflect the actual outcome of such items or
factors. By its nature, forward-looking information involves known
and unknown risks, uncertainties, changes in circumstances and
other factors that are difficult to predict and many of which are
outside of the Company's control which may cause the Company's
actual results, performance or achievements, or other future
events, to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking information. The Company's actual results may
differ materially from those indicated in the forward-looking
information. Important factors that could cause actual results to
differ materially from those indicated in the forward-looking
information include, among others, the risk factors described under
the heading "Caution Regarding Forward Looking Information" in the
Company's Management's Discussion & Analysis for the year ended
December 31, 2023, which is available
on the Company's profile at www.sedar.com. The Company has assumed
that the risk factors referred to above will not cause such
forward-looking statements and information to differ materially
from actual results or events. The reader is cautioned to consider
these and other factors, uncertainties and potential events
carefully and not to put undue reliance on forward-looking
statements.
Other than as specifically required by applicable Canadian law,
the Company undertakes no obligation to update any forward-looking
statement to reflect events or circumstances after the date on
which such statement is made, whether as a result of new
information, future events or results, or otherwise.
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.
For more
information: https://www.thinkresearch.com/ca/investors/
SOURCE Think Research Corporation