Mr. Nolan Reeds reports
MCI ONEHEALTH ANNOUNCES RELATED PARTY LOAN
MCI Onehealth Technologies Inc. has entered into a loan agreement to borrow up to $5-million by way of a secured loan from The First Canadian Wellness Co. Inc. as lender.
Amounts may be advanced during the term of the loan in such amounts and at such times as agreed to by the lender and the company, up to the maximum amount of the loan. The company may pay the lender a commitment fee of up to $100,000 in respect of the loan.
MCI Onehealth intends to use the proceeds of the loan to finance its continuing operations and for general and administrative expenses, subject to any specific use of proceeds agreed with the lender in respect of each advance.
The loan bears interest at a rate of prime plus 9 per cent per annum. The loan is repayable on the earlier of Dec. 31, 2023, the date that there is a change of control of the company or any refinancing by the company. The company may prepay the loan, in whole or in part, at any time without penalty. Each of the company's material subsidiaries has provided a guarantee in favour of the lender with respect to amounts advanced under the loan. Pursuant to the loan agreement, the company and its material subsidiaries have entered into a general security agreement in favour of the lender, and amounts advanced under the loan are secured against substantially all of the property and undertaking of the company and such subsidiaries.
Dr. George Christodoulou and Dr. Sven Grail, directors, co-chairs and control persons of MCI Onehealth, control the lender. Accordingly, the loan constitutes a related-party transaction under the Toronto Stock Exchange company manual and under Multilateral Instrument 61-101 (Protection of Minority Security Holders in Special Transactions). Pursuant to the company manual, the loan was unanimously approved by the board with Dr. Christodoulou and Dr. Grail abstaining from voting to approve the loan in their capacities as directors of MCI Onehealth. MCI Onehealth is exempt from the formal valuation requirement under MI 61-101 as the fair market value of the consideration for the loan does not exceed more than 25 per cent of the market capitalization of MCI Onehealth as of the date of the loan agreement. MCI Onehealth is also exempt from the minority approval requirement under MI 61-101 on the foregoing basis and because the loan is not convertible into or repayable in securities of MCI Onehealth and has been obtained on reasonable commercial terms that are not less advantageous to MCI Onehealth than if the loan were obtained from an arm's-length party.
MCI Onehealth did not file a material change report more than 21 days before the expected closing date of the loan, as the details of the loan and loan agreement were not finalized until immediately prior to the closing and MCI Onehealth wished to close the transaction as soon as practicable so that MCI Onehealth could begin using and benefiting from the loan as soon as possible.
About MCI Onehealth Technologies Inc.
MCI Onehealth is a health care technology company focused on empowering patients and doctors with advanced technologies to increase access, improve quality and reduce health care costs. As part of the health care community for over 30 years, MCI Onehealth operates one of Canada's leading primary care networks with nearly 260 physicians and specialists, serves more than one million patients annually, and had nearly 300,000 telehealth visits last year, including on-line visits. MCI Onehealth additionally offers an expanding suite of occupational health service offerings that support a growing list of nearly 600 corporate customers. Led by a proven management team of doctors and experienced executives, MCI Onehealth remains focused on executing a strategy centred around acquiring technology and health services that complement the company's current road map.
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