HEALWELL Gives Notice of Imminent Exercise of Call Option by WELL Health

Rhea-AI Summary

HEALWELL AI Inc. (TSX: AIDX) (OTCQX: HWAIF) announced that WELL Health Technologies Corp. plans to exercise its call option to acquire 61.6 million shares (30.8M Class A and 30.8M Class B) from existing shareholders. This action coincides with HEALWELL's acquisition of Orion Health Holdings , expected to complete on April 1, 2025.

Following the Orion Health acquisition, HEALWELL will have approximately 261.5 million Class A shares outstanding. After exercising the call option, WELL will own about 37.3% of economic interest and 69.6% of voting rights in HEALWELL. The deal grants WELL the ability to nominate a majority of HEALWELL's Board of Directors.

Positive

• Strategic acquisition by WELL Health increases stability and backing
• Concurrent completion of Orion Health acquisition expands business operations

Negative

• Significant voting control (69.6%) transferred to WELL Health
• Existing shareholders' influence diluted with WELL gaining board control

Toronto, Ontario--(Newsfile Corp. - March 31, 2025) - HEALWELL AI Inc.  (TSX: AIDX) (OTCQX: HWAIF) ("HEALWELL" or the "Company"), a healthcare artificial intelligence company focused on preventative care, announced today that it understands WELL Health Technologies Corp. ("WELL") intends to exercise its right to acquire 30,800,000 Class A Subordinate Voting Shares ("SVS") and 30,800,000 Class B Multiple Voting Shares ("MVS") of the Company from certain of its existing shareholders (the "Call Right") pursuant to the call option agreement between HEALWELL, WELL, certain founding shareholders of HEALWELL and their permitted transferees dated October 1, 2023 (the "Call Option Agreement").

The Call Right is expected to be exercised concurrently with the closing of the acquisition by the Company of Orion Health Holdings Limited ("Orion Health"), which is anticipated to be completed on April 1, 2025. The parties intend to enter into an amendment to the Call Option Agreement on the same date to facilitate and streamline the mechanics of the exercise of the Call Right.

Exercise of the Call Right

It is anticipated that HEALWELL will have approximately 261,547,371 SVSs issued and outstanding on HEALWELL's acquisition of Orion Health, following the issuance of 35,643,478 SVSs to the vendor in the Orion Health acquisition, 12,737,500 SVSs in connection with the conversion of 12,737,500 subscription receipts as part of the $25.5 million equity financing used to partially finance the purchase price of Orion Health, and the exercise or conversion of certain outstanding warrants and convertible debentures. Following the exercise of the Call Right, it is anticipated that WELL will own 97,223,161 SVSs and 30,800,000 MVSs or approximately 37.3% of the economic interest and approximately 69.6% of the voting rights in HEALWELL on a non-diluted basis. Each MVS has nine votes per share and each SVS has one vote per share.

Under the previously disclosed investor rights agreement between HEALWELL and WELL dated October 1, 2023 (the "Investor Rights Agreement"), upon the exercise of the Call Right, WELL will also have the ability to nominate a majority of the directors to the Board of Directors of the Company.

Additional Information

WELL was approved as a control person of HEALWELL by resolutions of the shareholders of HEALWELL, on a disinterested basis, on September 21, 2023. The TSX subsequently approved WELL as a control person of HEALWELL on October 6, 2023.

Additional information with respect to the Call Option Agreement and the Investor Rights Agreement and their material terms can be found in HEALWELL's Notice of Meeting and Management Information Circular dated August 21, 2023, which is available under the Company's profile on SEDAR+ at www.sedarplus.ca. Additional information on WELL's intention to exercise the Call Right and its anticipated ownership and control of the Company are set out in WELL's press release issued today and available under WELL's profile on SEDAR+ at www.sedarplus.ca.

Dr. Alexander Dobranowski
Chief Executive Officer
HEALWELL AI Inc.

About HEALWELL AI

HEALWELL is a healthcare artificial intelligence company focused on preventative care. Its mission is to improve healthcare and save lives through early identification and detection of disease. Using its own proprietary technology, the Company is developing and commercializing advanced clinical decision support systems that can help healthcare providers detect rare and chronic diseases, improve efficiency of their practice and ultimately help improve patient health outcomes. HEALWELL is executing a strategy centered around developing and acquiring technology and clinical sciences capabilities that complement the Company's road map. HEALWELL is publicly traded on the Toronto Stock Exchange under the symbol "AIDX" and on the OTC Exchange under the symbol "HWAIF". To learn more about HEALWELL, please visit https://healwell.ai/.

Forward-Looking Statements

Certain statements in this press release, constitute "forward-looking information" and "forward looking statements" (collectively, "forward looking statements") within the meaning of applicable Canadian securities laws, including statements about the Company's anticipated acquisition of Orion Health; the anticipated timing of completing the acquisition of Orion Health; the anticipated amendment of the Call Option Agreement and exercise of the Call Right by WELL; and the Company's anticipated issued and outstanding securities following completion of the Orion Health acquisition; and are based on assumptions, expectations, estimates and projections as of the date of this press release. Forward-looking statements are often, but not always, identified by words or phrases such as "expect", "intend", "anticipate" or variations of such words and phrases or statements that certain future conditions, actions, events or results "will", "may", "could", "would", "should", "might" or "can" be taken, occur or be achieved, or the negative of any of these terms . Forward-looking statements are necessarily based upon management's perceptions of historical trends, current conditions and expected future developments, as well as a number of specific factors and assumptions that, while considered reasonable by HEALWELL as of the date of such statements, are outside of HEALWELL's control and are inherently subject to significant business, economic and competitive uncertainties and contingencies which could result in the forward-looking statements ultimately being entirely or partially incorrect or untrue. Forward looking statements contained in this press release are based on various assumptions, including, but not limited to, the following: the Company's ability to satisfy any remaining conditions precedent to completion of the Orion acquisition; HEALWELL's ability to complete the acquisition on the timelines and terms contemplated; WELL's ability to satisfy any remaining conditions to exercising its Call Right; WELL's ability to complete the exercise of the Call Right on the timelines and terms contemplated; the potential exercise or conversion of outstanding warrants, equity incentives and other securities convertible into securities of HEALWELL; the stability of general economic and market conditions; HEALWELL's ability to comply with applicable laws and regulations; and that the risk factors noted below, collectively, do not have a material impact on HEALWELL's business, operations, revenues and/or results. By their nature, forward-looking statements are subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections, or conclusions will not prove to be accurate, that assumptions may not be correct, and that objectives, strategic goals and priorities will not be achieved.

Known and unknown risk factors, many of which are beyond the control of HEALWELL, could cause the actual results of HEALWELL to differ materially from the results, performance, achievements, or developments expressed or implied by such forward-looking statements. Such risk factors include but are not limited to those factors which are discussed under the section entitled "Risk Factors" in HEALWELL's most recent annual information form dated April 1, 2024, which is available under HEALWELL's SEDAR+ profile at www.sedarplus.ca. The risk factors are not intended to represent a complete list of the factors that could affect HEALWELL and 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. There can be no assurance that forward looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements are provided for the purpose of providing information about management's expectations and plans relating to the future. HEALWELL disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, or to explain any material difference between subsequent actual events and such forward-looking statements, except to the extent required by applicable law. All of the forward-looking statements contained in this press release are qualified by these cautionary statements.

For more information:

Pardeep S. Sangha
Investor Relations, HEALWELL AI Inc.
Phone: 604-572-6392
ir@healwell.ai

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/246696

FAQ

What percentage of HEALWELL AI (HWAIF) will WELL Health own after exercising the call option?

WELL Health will own 37.3% economic interest and 69.6% voting rights in HEALWELL AI on a non-diluted basis.

How many shares is WELL Health acquiring through the HWAIF call option?

WELL Health is acquiring 30.8 million Class A Subordinate Voting Shares and 30.8 million Class B Multiple Voting Shares, totaling 61.6 million shares.

When will WELL Health exercise its call option for HWAIF shares?

WELL Health plans to exercise the call option on April 1, 2025, concurrent with HEALWELL's acquisition of Orion Health Holdings.

What control rights will WELL Health gain over HEALWELL AI (HWAIF)?

WELL Health will gain the ability to nominate a majority of HEALWELL's Board of Directors, along with 69.6% of voting rights.