Cloud DX Inc. Announces Closing of Qualifying Transaction

As a result of the Transaction, Cloud DX, Inc., a Delaware entity, became a wholly-owned subsidiary of Cloud Canada, and Cloud Canada became a wholly-owned subsidiary of the Company.

April 13, 2021

Toronto, Ontario--(Newsfile Corp. - April 12, 2021) -  Cloud DX Inc. (formerly Roosevelt Capital Group Inc.) (TSXV: CDX) ("Cloud DX" or the "Company") is pleased to announce that it has completed its previously announced "Qualifying Transaction" (as defined by Policy 2.4 of the TSX Venture Exchange (the "Exchange")) involving a plan of arrangement pursuant to which 12632926 Canada Ltd. ("Cloud Canada"), was amalgamated with a wholly-owned subsidiary of the Company (the "Transaction"). As a result of the Transaction, Cloud DX, Inc., a Delaware entity, became a wholly-owned subsidiary of Cloud Canada, and Cloud Canada became a wholly-owned subsidiary of the Company. In addition, the Company is pleased to announce the exchange of the subscription receipts (the "Subscription Receipts") issued by Cloud Canada in connection with the previously announced private placement offering of Subscription Receipts undertaken in connection with the Transaction. In accordance with the terms of the agreement governing the Subscription Receipts, the net proceeds of approximately $5.5 million were released to the Company upon completion of the Transaction.

Prior to closing the Transaction, the Company consolidated its issued and outstanding common shares on a 4.8123 to 1 basis (each post-consolidation common share, a "Common Share") and changed its name from "Roosevelt Capital Group Inc." to "Cloud DX Inc.". Subsequently, the Company continued out of Alberta under the Business Corporations Act (Alberta) into the federal jurisdiction of Canada under the Canada Business Corporations Act (the "Continuance") and adopted new articles and bylaws. The Company's new CUSIP number for the Common Shares is 18912D100 and its new ISIN is CA18912D1006. Shareholders of the Company are not required to take any action with respect to the name change, consolidation or Continuance and are not required to exchange any existing certificates bearing the Company's new name. The Company's transfer agent, Odyssey Trust Company, will send registered shareholders a new Direct Registration System advice ("DRS") representing the number of Common Shares held by such shareholders.

The Transaction was completed by way of three cornered amalgamation, pursuant to which the Company issued 67,259,492 Common Shares to the shareholders of Cloud Canada (including 12,190,000 Common Shares to former holders of Subscription Receipts), at a deemed price of $0.50 per Common Share.

Final acceptance of the Transaction will occur upon the issuance of the Final Exchange Bulletin by the Exchange. Subject to final acceptance by the Exchange, the Common Shares are expected to commence trading on the Exchange under the symbol "CDX" on or about April 15, 2021, and the Company will be classified as a Tier 2 issuer pursuant to Exchange policies.

In connection with the Transaction, the Company's incumbent board of directors has been reconstituted and is now comprised of the following individuals: Robert Kaul, Sandeep Kohli, Michele Middlemore, Brad Miller, Constantine Zachos and William Charnetski. Additionally, the board has appointed Robert Kaul as President and Chief Executive Officer, Stephanie Bird as Chief Financial Officer and Corporate Secretary, Anthony Kaul as Chief Operating Officer, and Sandeep Kohli as Chief Medical Officer.

Capital Structure

Upon completion of the Transaction, including the conversion of the Subscription Receipts, the issued and outstanding share capital of the Company consists of 72,094,396 Common Shares, including 1,094,490 Common Shares as advisory and finder shares in connection with the Transaction (collectively, the "Advisor Shares"), and 12,190,000 Common Shares upon conversion of the Subscription Receipts. The Advisor Shares are subject to a 4 month hold under applicable Canadian securities laws.

A total of 23,692,045 Common Shares will be subject to escrow restrictions, including 623,402 Common Shares originally issued to the Company's principals upon listing the Company as a "capital pool company" (the "CPC Escrow Shares"), and 23,068,643 Common Shares issued to new principals in connection with the Transaction (the "Surplus Escrow Shares"). All CPC Escrow Shares will be released from escrow as to 25% upon the date of the Final Exchange Bulletin, with an additional 25% every 6 months thereafter. The Surplus Escrow Shares are subject to a Tier 2 surplus escrow agreement, and will be released from escrow over 36 months from the date of the Final Exchange Bulletin, with 5% released upon listing.

A total of 23,068,643 Common Shares are subject to voluntary pooling agreements (the "Pooling Agreement Shares") entered into in connection with the Subscription Receipt Financing. The Pooling Agreement Shares may not be traded until the earlier of: (i) provided the Common Shares have been listed and posted for trading on the Exchange for at least six months, the first business day on which the trading price for the Common Shares exceeds $1.125; and (ii) the date that is 12 months from the date the Common Shares are listed on the Exchange.

In addition, 89,513 Common Shares are subject to seed share resale restrictions over 4 months, with 20% to be free trading upon listing, with an additional 20% every month thereafter.

The Company also has 7,570,919 Common Shares reserved for issuance on exercise of the following outstanding securities:

  • 6,095,000 Common Share purchase warrants;
  • 752,200 broker warrants;
  • 685,743 purchase options issued by Roosevelt Capital Group Inc. prior to completion of the Transaction; and
  • 37,976 finder warrants.

For additional information concerning the Transaction and the foregoing matters, please refer to the Company's filing statement dated March 31, 2021, or the Company's press releases dated May 1, 2020, October 16, 2020, January 19, 2021, January 29, 2021, February 26, 2021, March 15, 2021, March 29, 2021 and April 8, 2021 which are available on the Company's SEDAR profile at www.sedar.com.

About Cloud DX

Cloud DX is a leader in virtual healthcare and digital medicine with rapidly growing sales across North America. Our complete remote patient monitoring platform incorporates proprietary medical devices, mobile apps, clinical dashboards, artificial intelligence and EMR integration. Cloud DX now provides products and services to hospitals, healthcare providers and provincial health departments across North America. In 2020, Cloud DX was a co-recipient of the Roche COVID Challenge award, and is widely recognized for their ground-breaking med tech innovations, including winning the Qualcomm Tricorder XPRIZE Bold Epic Innovator Award, Fast Company magazine "World Changing Idea" and most recently a 2021 Edison Award nomination.

For further information, please contact:

Robert Kaul, Chief Executive Officer
Cloud DX Inc.
Telephone: (888) 534-0944
Email: ceo@clouddx.com

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