CPS Capital entered into a definitive arrangement agreement to acquire CloudMD Software & Services Inc. (TSXV:DOC) for CAD 12.7 million on May 14, 2024. Pursuant to the agreement, CPS has agreed to acquire all of the outstanding common shares of CloudMD for cash consideration of CAD 0.04 per share. The expected gross proceeds based the estimated CAD 0.04 per share reflects a CAD 12 million equity value before considering transactions costs. CPS Capital is funding the transaction through a combination of equity from its new flagship fund CPS Partners Fund V and its previous flagship fund CPS Partners Fund IV. Following completion of the transaction, the CloudMD shares will be delisted from the TSX Venture Exchange (the ?TSXV?), and the Company will apply to cease to be a reporting issuer in applicable provinces in Canada. Under certain circumstances, CPS Capital is entitled to a CAD 3 million termination fee or an expense reimbursement to a maximum of CAD 1.75 million, and CloudMD is entitled to a $1.75 million (CAD 2.391060 million) reverse termination fee.

The transaction will be completed pursuant to a court-approved plan of arrangement under the Business Corporations Act (British Columbia). The transaction will be subject to the approval of at least: (i) 66 2/3% of the votes cast by shareholders; (ii) 66 2/3% of the votes cast by shareholders and option holders voting as a single class; and (iii) 50% of the votes cast by disinterested shareholders at a special meeting of CloudMD securityholders expected to be held before the end of June 2024. In addition to securityholder approval, the transaction is also subject to the receipt of certain regulatory approvals, the approval by Supreme Court of British Columbia and the TSX Venture exchange approval, Dissent Rights shall not have been validly exercised, and not withdrawn or deemed to have been withdrawn, with respect to more than 5% of the issued and outstanding Shares and other closing conditions customary in transactions of this nature. The transaction has been unanimously approved by the Board of Directors of the CloudMD following the unanimous recommendation of a special committee of independent directors of the CloudMD. The directors and executive officers of CloudMD, who collectively hold approximately 0.16% of the outstanding Shares and approximately 0.60% of the outstanding Shares and stock options collectively, entered into voting support agreements with CPS to support the transaction. The transaction is expected to be completed in July 2024.

INFOR Financial has provided an opinion to the Special Committee. INFOR Financial is acting as the exclusive strategic and financial advisor to CloudMD and Frank Arnone and Lindsay Clements of Cassels Brock & Blackwell LLP is acting as legal counsel to CloudMD in connection with the transaction. Paul De Luca of Owens Wright LLP is acting as legal counsel to CPS Capital in connection with the transaction.