04:36:08 EDT Thu 28 Mar 2024
Enter Symbol
or Name
USA
CA



Lendified Holdings Inc
Symbol LHI
Shares Issued 95,154,575
Close 2020-07-07 C$ 0.02
Market Cap C$ 1,903,092
Recent Sedar Documents

Lendified Holdings to sell AI tech subsidiary

2020-07-07 12:07 ET - News Release

Mr. Troy Wright reports

LENDIFIED ANNOUNCES SALE OF WHOLLY-OWNED SAAS SUBSIDIARY

Lendified Holdings Inc.'s wholly owned subsidiary, Lendified Privco Holding Corp. (Subco), has entered into a share purchase agreement to sell Lendified Technologies Inc, the company's indirect wholly owned subsidiary which provides a software-as-a-service technology platform providing artificial intelligence-enabled credit origination and analytics to financial institutions across Canada. Pursuant to the agreement, Subco will sell all of the issued and outstanding shares of Lendified Technologies to 12173115 Canada Inc., which includes a group of investors, including, among others, the current chief executive officer of Lendified Technologies.

The purchase price for the shares of Lendified Technologies consists of $1 and up to $100,000 payable to Lendified Technologies's auditor on behalf of Subco upon receipt of Lendified Technologies of its scientific research and experimental development (SRED) program claims for the periods from Jan. 1, 2019, to Dec. 31, 2019, and Jan. 1, 2020, to April 28, 2020. Pursuant to the agreement, the purchaser will assume all of the liabilities and obligations of Lendified Technologies.

At closing, Subco and Lendified Technologies will enter into a licensing agreement pursuant to which Lendified Technologies will receive a royalty-free licence to use all loan performance data collected by Subco to date and for the three-year period subsequent to closing and Subco will receive a royalty free licence to use Lendified Technologies' financial categorization engine for the three-year period subsequent to closing.

The completion of the transaction is subject to certain closing conditions, including, among others, the receipt of all necessary regulatory approvals, including by the TSX Venture Exchange; there being no prohibitions under applicable securities or other laws to the completion of the transaction; the consent of necessary third parties, including the company's and Lendified Technologies' creditors; the release of the company and certain of its subsidiaries from their respective guarantees of Lendified Technologies' indebtedness; and the release of Lendified Technologies from its guarantees of certain of the company's indebtedness. The company will provide an update when final regulatory and TSX Venture Exchange approvals have been received and the transaction has been completed.

The transaction is a non-arm's length transaction for purposes of the policies of the TSX-V and applicable securities laws as the purchaser group includes the chief executive officer of Lendified Technologies. The company intends to rely on applicable exemptions from the valuation and shareholder approval requirements for a transaction of this nature provided such exemptions are available and granted to the company by the TSX-V.

The transaction is part of the company's overall strategy toward improving its financial condition as announced in the company's press release dated June 25, 2020. Lendified Technologies is not yet cash positive and continues to require cash infusions in the amount of approximately $100,000 per month in order to maintain operations. Its cash reserves at this time are approximately $80,000. At this time, the company is not in a position to continue to finance Lendified Technologies' business and there are no assurances that it would be able to do so in the future. The transaction is designed to improve the company's financial position as the purchaser has agreed to assume the liabilities and obligations of Lendified Technologies, relieving the company of the financial burden of financing Lendified Technologies' operations until it becomes cash positive.

About Lendified Holdings Inc.

Lendified, a company located in Ontario, Canada, is a leading Canadian financial technology company operating both a lending platform which provides working capital loans to small businesses across Canada through its wholly owned subsidiary, Lendified Inc., and a software-as-a-service technology platform through Lendified Technologies.

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