TORONTO, ONTARIO--(Marketwire - May 28, 2012) -
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Attention: Business/Financial Editors
The Medipattern Corporation ("Medipattern") (TSX VENTURE:MKI), announced today that it has signed a binding letter agreement (the "Transaction") with MYTRAK® Health System Inc. ("MYTRAK") to combine their technologies and launch a new personalized mobile health business called MyTrak Personal Health Solutions, focusing on monitoring physical activity for the management of Metabolic Syndrome. This will be achieved by leveraging MYTRAK's proven wearable mobile technology platform which complements Medipattern's core proprietary cardiovascular visualization and image analysis business launched in by Medipattern in June, 2011. Metabolic Syndrome is a group of medical risk factors that, when occurring together, indicate that an individual is at elevated risk to developing cardiovascular disease and/or diabetes. Medipattern will acquire MyTrak's Mobile Technology Business Unit including intellectual property and patented technology through this transaction.
"The Transaction is expected to be highly accretive for Medipattern shareholders as the potential market for the MyTrak Personal Health Solutions is a multi-billion dollar industry. The market for wireless wearable devices is expected to hit 165 million units by 2017 according to industry analysts ABI Research while the medical component is estimated to have an annual compound growth rate of 65%. The mobile health market is being driven in the United States by wide spread adoption of devices with over 50% of people already using a mobile device. The Pew Research Center, Internet and American Life Project, reports that 17% of US mobile phone users are already accessing health information on their mobile devices with an estimated 44 million health apps having been downloaded in 2011," stated Jeff Collins, President and CEO of Medipattern.
Smart Coach uses personal biometric information such as age, sex, weight, height as well as the user's lifestyle information such as job description, smoker status, physical fitness level, Activities of Daily Living (ADLs) and any injury or malady information. With all such information uploaded to a host server, accessible via any wireless or hard-wired device connected to the internet, MyTrak's technology platform enables the monitoring of physical activity, lifestyle and nutritional habits; to provide personalized coaching and proactive intervention to support a change in each user's individual behaviour for the prevention and management of Metabolic Syndrome. Daily physical activity has been proven to play a key role in reducing the risk of developing cardiovascular disease and diabetes.
The dramatic rise in obesity is fueling an increase in cases of diabetes and cardiovascular disease, significantly adding to the rising cost of health care in the U.S.1 The estimated annual cost of diabetes in the U.S. was $174 billion in 2007, including $116 billion in direct medical costs.2 The number of Americans with diabetes has more than doubled since 1980, primarily due to increases in Type 2 diabetes, which is closely associated with obesity, inactivity and aging. The U.S. Center for Disease Control and Prevention (CDC) now estimates that 25.8 million Americans have diabetes and that 7 million of them do not know it.3 In 2010, the total cost for cardiovascular disease in the United States was estimated to be $444 billion.4 This total includes the cost of health care services, medications, and lost productivity. The primary risk factors for cardiovascular disease are inactivity, obesity, diet, blood pressure, cholesterol and family history.
"While continuing to grow our vascular business, we noticed the majority of patients are placed in continuing follow-up care with a common theme to lose weight, exercise daily and return for a visit in 6 months," stated Jeff Collins. "Many of these patients are at high risk to heart attack and stroke. There are no effective monitoring programs designed to track individual physical activity, lifestyle, behavior, nutrition, nor progress toward the patient's personal training program for improved health. Many doctors have asked us if there is a way we could track these patients and compare the patient's actual performance against their individual training program."
Collins continues, "MyTrak Personal Health Solutions will provide exactly that solution in a patented, easy to use, effective and proven package. MYTRAK's well established in-club technology has been deployed in nearly 4,000 health clubs worldwide where the automated system monitors and guides people through approximately three million workouts weekly in 21 countries. MyTrak Personal Health Solutions will be responding to the growing concern of health plan administrators, health practitioners, as well as employers in the United States who are looking for technology solutions, smart phone apps, and social community portals, each delivering intervention strategies to better engage patients and employees in their daily health and wellness, including monitoring individual prescriptions, weight and providing tools to enhance communications with providers and hospitals."
"MyTrak has successfully tackled the real need and has helped millions of people improve their health by working out effectively using MYTRAK systems. Now, by combining both company's technologies into a wearable mobile solution we are confident we can help millions more who struggle with the management of their conditions through personalized monitoring of their progress with enhanced physical activity and better lifestyle choices," said Reed Hanoun President and CEO of MYTRAK Health System Inc.
The terms of the agreement (the "Transaction") include:
- Medipattern will issue 11,400,000 common shares to MYTRAK or its shareholders on closing. Medipattern currently has 57,404,579 million shares issued and outstanding.
- Medipattern will also pay $500,000 upon closing and an additional $500,000 upon satisfaction of certain milestones.
- MYTRAK's key personnel and related senior management will continue to spearhead the MyTrak Personal Health Solutions business unit of Medipattern.
- Medipattern has engaged Industrial Alliance Securities Inc. (the "Agent") to act as agent to raise, by way of private placement, at $0.25 per common share, a minimum of $3,000,000 and a maximum of $5,000,000 with closing expected on or before June 15th, 2012 (the "Financing"). Under the terms of the Financing, the Agent will receive a cash commission representing 4% of the gross proceeds from the sale of common shares and broker warrants entitling the Agent to purchase up to that number of common shares as is equal to 8% of the aggregate number of common shares sold in the Financing, exercisable at $0.25 per share for two years from the closing date.
Industrial Alliance Securities Inc. is a division of Industrial Alliance Insurance and Financial Services Inc., a leading global financial services organization.
For more information about Industrial Alliance Securities Inc. please visit http://www.inalco.com/english/individual/investment/securities/securities.jsp.
Medipattern plans to use the proceeds from the proposed private placement financing to provide working capital for its current business, including its focus on commercializing Visualize:Vascular™, and upon closing of the Transaction, to expand the business unit of MyTrak Mobile Health Solutions.
The securities offered in the placement have not been and will not be registered under the United States Securities Act of 1933, as amended, (the "U.S. Securities Act"), and may not be offered or sold within the United States or to, or for the account or benefit of U.S. persons except in certain transactions exempt from the registration requirements of the U.S. Securities Act.
The closing of the Transaction is subject to the satisfaction of standard closing conditions, including, but not limited to: (i) negotiation and execution of a definitive agreement; (ii) completion of due diligence by each of Medipattern and MYTRAK; (iii) the parties having obtained all authorizations, approvals or waivers that may be necessary or desirable in connection with the Transaction; (iv) the parties having complied with all warranties, representations, covenants and agreements therein agreed to be performed or caused to be performed on or before the closing date; (v) no action or proceeding in law or in equity shall be pending or threatened by any person, company, firm, governmental authority, regulatory body or agency to enjoin or prohibit any of the transactions contemplated by the Transaction; and (vi) TSX Venture Exchange approval of the Transaction, including the issuance of the common shares and the Financing.
|1Center for Disease Control and Prevention (CDC), "National Center for Chronic Disease Prevention and Health Promotion, Division of Nutrition, Physical Activity and Obesity (http://www.cdc.gov/nccdphp/dnpao/index.html): The Obesity Epidemic" 7/22/2011.
|2American Diabetes Association, "The Cost of Diabetes" 1/26/2011.
|3American Diabetes Association, "Diabetes Statistics" 1/26/2011.
|4Center for Disease Control and Prevention (CDC), Heart Disease and Prevention, "Addressing the Nation's Leading Killers: At A Glance 2011" February 2012.
About the Medipattern Corporation:
Medipattern® is a pioneer in the development of imaging software solutions that help medical practitioners to better understand lesions and critical anatomy. Medipattern uses its Cadenza™ technology to process images, finding the salient region of interest and presenting them in 2D and 3D formats that enhance the reader's perception. For more information, please visit the Company's website: www.medipattern.com.
About MYTRAK Health System Inc.:
At MYTRAK GO FOR GREEN is all about you - your health, your fitness, your way. MYTRAK Health System Inc. is dedicated to standardizing the process of making people healthy - guiding success by engaging and motivating people to stay physically active at home, at work and at play through the use of our state-of-the-art technology. The Vision of MYTRAK Health System - A healthy and fit society, one person at a time - is based on the premise that participation in effective physical activity is absolutely necessary to improve health and thereby reduce health care costs for all population and age demographics. For more information, please visit the Company's website: www.mytrak.com.
Medipattern® is a registered mark of The Medipattern Corporation. Cadenza™ and Visualize:Vascular™ are trademarks of the Medipattern Corporation. MYTRAK® is a registered trademark of MyTrak Health Solutions, Inc.
This document contains forward-looking statements relating to Medipattern's performance, operations, or business environment. These statements are based on what we believe are reasonable assumptions given currently available information and our understanding of Medipattern's current activities. We have tried, whenever possible, to identify these forward-looking statements using words such as "anticipates," "believes," "estimates," "expects," "plans," "intends," "potential," and similar expressions. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict or control. A number of factors could cause actual outcomes and results to differ materially from those expressed in forward-looking statements. These factors include but are not limited to those set forth in the Company's corporate filings, (posted at www.sedar.com). In addition, these forward-looking statements relate to the date on which they are made. The Company disclaims any intention or obligation to update or revise any forward-looking statements for any reason. Readers should not rely on forward-looking statements.
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.