VANCOUVER, BCJune 29, 2023 /CNW/ – CareSpan Health, Inc. (TSXV: CSPN) (“Company” or “CareSpan”), is pleased to announce that it has arranged an additional interim debt financing in the aggregate amount of USD$100,000 (the “Loan“) with: (a) an insider of the Company, William Bradford White (in the amount of USD$50,000); and (b) the Chief Executive Officer and director of the Company, Rembert de Villa (in the amount of USD$50,000) (collectively, the “Lenders“). This is an additional amount provided by the Lenders, who participated in the previous interim debt financing of the Company in the amount of USD$120,000 and USD$100,000, respectively, as announced in the Company’s press release dated April 14, 2023.

Pursuant to the terms of the Loan, the Company will receive a term loan in the aggregate amount of USD$100,000. The Loan is unsecured and matures in one year from the date of issuance, when the principal and all accrued and unpaid interest are due in full. The Loan bears interest at a rate of 12% per annum. Payment of the Loan and accrued interest may be accelerated by the Company at any time without any penalty. Pursuant to the terms of the Loan, the Lenders have the option in the future to convert, fully or partially, the outstanding Loan and accrued interest into common shares in the capital of the Company (the “Conversion Option”) solely during periods in which the Company is undergoing a qualified equity financing by way of debt, equity or some combination thereof for aggregate gross proceeds of at least CAD$1 million. If the Conversion Option is exercised by the Lenders, the Company will be required at that time to make an application for approval of the Conversion Option by the TSX Venture Exchange in accordance with its applicable policies.

The proceeds from the Loan will be used to: (i) fund capital and related expenditures for existing projects, and (ii) provide general working capital to help fund the Company’s growth opportunities.

The Loan constitutes a “related party transaction” as defined under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101“) as the Lenders are related parties of the Company given that: (i) William Bradford White holds greater than 10% of the Company’s shareholdings; and (ii) Rembert de Villa is the Chief Executive Officer of the Company. The Company has relied on exemptions contained in section 5.5(a) and 5.7(1)(a) of MI 61-101 from the valuation and minority shareholder approval requirements in MI 61-101 in respect of the Loan since the fair market value of the Loan does not exceed 25% of the Company’s market capitalization.