CloudTag (CTAG:LN) has said to DirectorsTalk that is has entered into a licence agreement with Imec International pursuant to which, inter alia, Imec has granted to the Company an exclusive worldwide commercial licence to the unique algorithms developed for CloudTag and used in the Company’s hardware devices.
As demonstrated by the results of user tests performed by CloudTag in collaboration with the University of Essex and announced by the Company on 26 October 2015, the algorithms developed by Imec to measure ECG and energy expenditure provide exceptionally high levels of accuracy. This accuracy is a significant differentiator for the Company’s wearable product and the directors believe that this makes it unique in the market.
Imec has agreed to take equity in CloudTag in consideration for the Licence under the terms of the Agreement, comprising of the issue of new ordinary shares in the Company in three tranches, the first of which being payable upon execution of the Agreement (“Initial Tranche”) and subsequent tranches falling due upon commercial launch of CloudTag’s product and the first anniversary thereafter. This consideration structure furthers the Company’s strategy to align all key strategic partners with the business.
In fulfilment of payment of the Initial Tranche, the Company has agreed to issue to Imec 1,906,556 new ordinary shares in the Company (“Initial Tranche Shares”), which will rank pari passu with the Company’s existing ordinary shares. Application will be made for the Initial Tranche Shares to be admitted to trading on AIM, which is expected to occur on or around 5 November 2015.
Following the issue of the Initial Tranche Shares, the total number of ordinary shares in issue will be 207,108,770. This number may be used by shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company.
Amit Ben-Haim, CloudTag CEO, comments: “I am extremely pleased that Imec has decided to become a shareholder of CloudTag and to have secured this Agreement as I believe this firmly validates the work we are doing and the future of our relationship with Imec. This is further reinforced by the results of the collaboration to date and in particular the accuracy of both the ECG and energy expenditure algorithms which we believe provides CloudTag with a unique selling point when we bring the wearable to market. I look forward to our continued collaboration as we commercialise the product in the coming months and look to future product development.”
