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Health Logic Interactive Inc (2)
Symbol	CHIP
Shares Issued	6,724,205
Close 2023-05-01	C$ 0.05
Market Cap	C$ 336,210
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Health Logic signs LOI to acquire ChipBrain

2023-08-09 15:18 ET - News Release

Subject: News Release distribution Word Document File: '\\swfile\EmailIn\20230809 120628 Attachment CHIP LOI Announcement.docx' Health Logic Interactive Announces Signing of Letter of Intent to Acquire ChipBrain, Inc. CALGARY, AB, August 9, 2023 - Health Logic Interactive Inc. ("Health Logic" or the "Company") (TSXV: CHIP.H) (OTCPK: CHYPF), a Company in the search of licensing and acquisition opportunities, is pleased to announce it has signed a non-binding Letter of Intent ("LOI") to acquire ChipBrain, Inc., ("ChipBrain" or the "Target") an established, commercial-stage artificial intelligence (AI) tech company that, through the use of real-time AI coaching and analytics, assists sales teams to increase company revenues and conversions, and empowers managers to more effectively oversee and enhance their teams. Mission & History: ChipBrain's mission is to provide any company with a sales function, a highly effective, easy-to-implement AI software solution to increase revenue, efficiency and morale. ChipBrain's fully developed, market-ready AI software platform allows sales professionals to gauge, analyse and react to real-time customer interactions over Zoom calls, voice calls, and text messaging/ emailing and gives tailored sales strategies to the employee to increase sales conversions, and maximise up-selling and cross-selling opportunities. Outside of real-time, actionable sales advice, ChipBrain's technology is used to identify more leads and optimally strategize for follow-up. The time saved in these now automated interactions can be invested in higher-quality customer interactions, resulting in better customer retention. For sales managers, and companies as a whole, ChipBrain is used as a monitoring tool to intervene in the sales function if and when a problem with a customer develops, preventing costly customer losses. It is also utilised in situations where customer interactions or employee to employee interactions trigger warnings in the system that deems a certain employee may require re-training in a certain area, which could lower attrition rates. ChipBrain's core technology and mission was developed by some of the earliest pioneers and brightest minds in the AI space. Several years ago, when AI was in its infancy, ChipBrain was born from a first-place win in the Harvard Business School MBA fund startup competition. Later that year, and partially as a result of the Harvard contest win, ChipBrain won an official partnership with Salesforce through the winning of Salesforce's Accelerator Executive Pitch Competition. Team & Founders: ChipBrain management and its founders include PhD's and academics from Harvard, Stanford, and MIT. Early access to research and applied research at these institutions has allowed the seamless tech transfer from academia to commercial launch, and now IPO. Instrumental to the commercialization of this platform technology is one of ChipBrain's early advisors, John Fanning. Mr. Fanning was the founder of Napster, the first peer-to-peer music sharing platform. At its peak, Napster had 100 million users and a valuation of $20 billion (Wall Street Journal). Mr. Fanning has agreed to join the newly-formed public company as an advisor, and will lead a committee on talent acquisition to attract other business and technology leaders to the team. Mr. Fanning has also identified several potential AI targets to introduce as potential acquisitions after this translation is completed. The composition of the management team, board of directors, and advisory board of the newly-formed public company will be announced in the press release that coincides with the definitive agreement on this acquisition. Industry & Opportunity: Generative AI (artificial intelligence) is poised to unleash the next wave of global productivity- and it's happening now. Global consulting firm McKinsey & Company found from their research that 90 percent of commercial leaders expect to utilise generative AI solutions "often" over the next two years. With a relatively small investment in AI, businesses can increase revenue 3-15%, according to the same firm. https://www.mckinsey.com/capabilities/growth-marketing-and-sales/our-insights/ai-powered-marketing-and-sales-reach-new-heights-with-generative-ai McKinsey estimates the total addressable market (TAM) of generative AI to be in the range of $2.6 trillion to $4.4 trillion, annually. McKinsey estimates ChipBrain's serviceable addressable market (SAM) niche, generative AI for sales, to be $486 billion annually. ChipBrain's serviceable obtainable market (SOM) at 1% could be worth $4.9 billion annually. https://www.mckinsey.com/capabilities/mckinsey-digital/our-insights/the-economic-potential-of-generative-ai-the-next-productivity-frontier#business-value Several other AI-based sales & marketing "tools" appear to be on the market today, but Health Logic has specifically targeted ChipBrain for acquisition over other targets because: The competitors generally lack a proprietary data set to add any value to potential clients; They offer a "micro" feature that does not provide a solution, but rather a "plug-in" type application that really does not benefit the sales funnel; The majority of companies in the AI sales/ marketing space are really just ChatGPT with a "skin" layered on top. ChipBrain's robust database and proprietary, stand-alone technology that was built over several years by some of the brightest in the industry. This head start provides a durable competitive advantage providing the best possible target for Health Logic's current and prospective shareholders in the AI space. Post-IPO Planning & Strategy: Health Logic's Board has determined, based on current market conditions for AI-related companies, that it is an optimal time to move forward with this transaction and additional investments into the space. According to the LOI, the company will undertake a capital raise at a to-be-determined size and valuation concurrently with that definitive agreement. The capital will be used to fund ChipBrain's growth initiatives including sales and marketing to start commercial sales of their market-ready product, key hires, and general corporate purposes. Health Logic and Mr. John Fanning, one of the founders of ChipBrain, are exploring additional licensing and acquisitions opportunities to support the goal of being an AI leader. Next Steps: The signing of the LOI initiates a period of detailed due diligence by both companies to evaluate the merits and risks of the transaction. Upon satisfactory review, a definitive agreement is drafted detailing the specifics of the anticipated transaction, including terms, share exchange ratios, closing conditions, plans for financing, and other important details regarding the transaction. Subsequently, necessary disclosure documents are prepared and submitted to the TSXV. If required, existing shareholders may be asked to vote on the transaction. The TSXV then conducts a regulatory review, and once approved, the transaction is finalized, leading to the new entity being listed for trading. Throughout this process, transparency is paramount. The company will issue press releases at significant milestones, ensuring investors are continually informed. Post-transaction, the resulting entity is obligated to maintain ongoing disclosures as mandated by the TSXV and securities regulators, ensuring consistent updates on financial and operational developments. The proposed acquisition of an AI-focused company highlights our continual dedication to incubating innovative technologies after our most recent technology exit with the sale of our lab on chip subsidiary. About ChipBrain Founded by MIT and Harvard graduates, ChipBrain designs the world's best communication-assistance AI to empower people with augmented empathy & persuasion in conversations. ChipBrain is inventing a world where people from different backgrounds can more easily relate to one another. About Health Logic Interactive Health Logic Interactive is a public entity on the NEX Board of the TSXV ("NEX") and intends to pursue its search for new assets to develop and make an application to the TSXV for a reactivation to Tier 2 of the TSXV from the NEX. The reactivation will be subject to meeting all continued listing requirements of Tier 2 of the TSXV. Further information regarding Health Logic Interactive Inc. and its disclosure documents are available on SEDAR at www.sedar.com. Neither the 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. Cautionary Notes Certain statements contained in this press release constitute "forward-looking statements". All statements other than statements of historical fact contained in this press release, are forward-looking statements. These statements are not guarantees of future performance and involve assumptions, risks and uncertainties that are difficult to predict. Therefore, actual results may differ materially from what is expressed, implied or forecasted in such forward-looking statements. These forward-looking statements are made as of the date of this press release and the Company assumes no obligation to update or revise them to reflect subsequent information, events or circumstances or otherwise, except as required by law. SOURCE Health Logic Interactive Inc. Harrison Ross, CEO, (1-877)-456-4424, harrison@healthlogicinteractive.com Investors: Tyler Troup Circadian Group IR CHIP@circadian-group.com