UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event Reported): November 17, 2021 (November 11, 2021)
Clearday, Inc.
(Exact Name of Registrant as Specified in Charter)
| Delaware | 0-21074 | 77-0158076 | ||
|
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
8800 Village Drive, Suite 106, San Antonio, TX 78217
(Address of Principal Executive Offices) (Zip Code)
(210) 451-0839
(Registrant’s telephone number, including area code)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| Common Stock, par value $0.001 | CLRD | OTCQB |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry into a Material Definitive Agreement.
Clearday, Inc. (the “Company” or “Clearday”), through its subsidiary Clearday Management Ltd., on November 11, 2021 entered into a Strategic Alliance, Development and Distribution Terms Agreement (the “JV Agreement”) with Invento Research Inc. (“Invento”). Under the terms of the JV Agreement, a company (the “JV”) formed by Invento and Clearday will focus on the development and deployment of robotic services that combine content and uses (or robotic applications) that empower, enhance and protect care workers providing services in the following (collectively, the “JV Core Business Market”): (1) the home and residential health and non-acute care markets, (2) residential care facilities such as assisted living, nursing home, skilled nursing and memory care facilities, (3) health care markets through hospitals, doctor offices, ambulatory surgical care centers, urgent care centers, and medical clinics, and (4) laboratories (e.g., facilities that administer blood testing services), occupational and physical therapy centers, and (5) telehealth applications. Each of Invento and Clearday will provide sufficient time and attention to the business of the JV and shall use their respective commercially reasonable efforts to advance the business of the JV.
Invento and Clearday expect to initially develop and deploy robotic applications that are based on needs for Clearday’s residential care and adult day care communities. Each of Invento and Clearday may add additional content and services to the robotic applications based on, among other factors (1) Clearday’s knowledge and experience in treating residents & clients with cognitive issues, and (2) Invento’s assessment of client requirement vis-à-vis the technological and financial feasibility of recommendations and iterations, if any. The JV is expected to market and sell robots, robotic services and related content and services, initially to the residential and home care markets, promptly after the deployment of the robots at Clearday facilities.
The JV will be managed by a 4 person board. Each of Invento and Clearday will appoint 2 members of the board. The JV board will establish the operating budget, including robot pricing, sales commissions and marketing expenses. Invento will sell its robots and related systems, and Clearday will sell its Clearday at Home digital and Clearday at Home PRO services, at their respective wholesale prices and each party has agreed to most favored nation pricing terms. Distributions will be made as determined from time to time by the JV board on a pro rata basis to Invento and Clearday and any other member of the JV admitted by Invento and Clearday, subject to priority distributions for cash investments to the JV.
Invento will not sell its robots and related services to any person in the JV Core Business Market without the consent of Clearday or an appropriate payment of a reasonable commission to Clearday as determined by the Board in its reasonable good faith discretion. No robots will be sold to a person that competes with Clearday in its businesses that are in the JV Core Business Market, without the consent of Clearday, which consent, shall be: (1) with respect to the digital service offerings of Clearday, in its sole and absolute discretion of Clearday; and (2) with respect to all other businesses, not be unreasonably withheld, delayed or conditioned. Clearday will provide its content that is customarily provided in its business to the JV and not to any other manufacturer of robotics that have substantially similar functionality of the robots in the JV Core Business Market.
The initial term of the JV is 5 years with successive 5 year terms subject to the JV achieving mutually agreed revenue targets that (1) for the initial period ends June 30, 2023, (2) then for the period ending December 31, 2022, and (3) for each annual period thereafter. If such revenue targets are not achieved, then either party may terminate the JV upon 60 days’ notice. In the event of such termination, the non-terminating party may initiate a buy / sell process to continue the business of the JV by either continuing to buy Robots at the wholesale price or the acquisition of Clearday at Home at the wholesale price.
The foregoing description of the JV Agreement is a summary only, is not intended to be complete, and is qualified in its entirety by reference to the full text of each such agreement that is filed as an exhibit to this Current Report on Form 8-K.
ITEM 7.01 REGULATION FD DISCLOSURE
On November 12, 2021, the Company issued a press release announcing the joint venture. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.
In accordance with General Instruction B.2 of Form 8-K, the information set forth in this Item 7.01 and in the press release attached as Exhibit 99.1 is deemed to be “furnished” and shall not be deemed to be “filed” for purposes of the Exchange Act. The information set forth in Item 7.01 of this Current Report on Form 8-K shall not be deemed an admission as to the materiality of any information in this Current Report on Form 8-K that is required to be disclosed solely to satisfy the requirements of Regulation FD.
Forward Looking Statements
This communication contains forward-looking statements (including within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended) concerning the Company. These statements may discuss goals, intentions and expectations as to future plans, trends, events, results of operations or financial condition, or otherwise, based on current beliefs of the management of the Company, as well as assumptions made by, and information currently available to, management. Forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “may,” “will,” “should,” “would,” “expect,” “anticipate,” “plan,” “likely,” “believe,” “estimate,” “project,” “intend,” and other similar expressions. Statements that are not historical facts are forward-looking statements. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance. Actual results could differ materially from those contained in any forward-looking statement as a result of various factors, including, without limitation: the risks regarding the Company and its business, generally; risks related to the Company’s ability to correctly estimate and manage its operating expenses and develop its innovate non-acute care businesses and the acceptance of its proposed products and services, including with respect to future financial and operating results; the ability of the Company to protect its intellectual property rights; competitive responses to the Company’s businesses including its innovative non-acute care business; unexpected costs, charges or expenses; regulatory requirements or developments; changes in capital resource requirements; and legislative, regulatory, political and economic developments. The foregoing review of important factors that could cause actual events to differ from expectations should not be construed as exhaustive and should be read in conjunction with statements that are included herein and elsewhere, including the risk factors included in the Company’s most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the SEC and the registration statement regarding the Company’s previously announced merger, that was filed and declared effective. The Company can give no assurance that the actual results will not be materially different than those based on the forward looking statements. Except as required by applicable law, the Company undertakes no obligation to revise or update any forward-looking statement, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.
| (d) | Exhibits. |
| No. | Description | |
| 10.1 | Strategic Alliance, Development and Distribution Terms Agreement by and among Invento Research Inc. and Clearday Management Ltd. dated November 11, 2021. | |
| 99.1 | Press Release dated November 12, 2021. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CLEARDAY, INC. | ||
| By: | /s/ James Walesa | |
| Name: | James Walesa | |
| Title: | Chief Executive Officer | |
| Dated November 17, 2021 | ||
Exhibit 10.1
Terms Agreement
Strategic Alliance, Development and Distribution
Invento Robotics and Clearday
November 11, 2021
This confidential terms agreement, dated as of the date written above, (“Terms Agreement”) provides the material terms and conditions pursuant to which Invento Research Inc. with offices in Plano TX 75024 (“Invento”) and Clearday Management Ltd., with offices at 8800 Village Drive, San Antonio, Texas 78217 (“Clearday”) for a joint venture to develop robotic based services primarily to the certain care industries such as residential care facilities, home care environments, health care facilities and similar environments.
| 1 |
|
The Board will have committees that direct and supervise certain business activities as determined by the Board. There will be initially two committees:
● one committee that will be controlled by the Invento Board designees, which will focus on the hardware, equipment development, software & related services customized for required user experience, fleet management/similar software for enabling real-time monitoring of robots and human expertise for real time handling of robots at required intervals where remote human care/involvement is needed. ● one committee that will be controlled by the Clearday Board designees, which will focus on developing content and additional use cases for the Robots and additional services that may be provided by the JV in the JV Core Business Market. However, development of additional use cases shall be developed based on feasibility.
The JV will elect officers as determined from time to time by the Board. The initial officers are expected to be:
|
| President: | Balaji Viswanathan | |
| Chief Operating Officer and General Counsel: | Richard Morris | |
| Treasurer: | BJ Parrish | |
| Chief Technology Officer: | Mahalakshmi Radhakrushnun | |
| Chief Strategy Officer: | Suhas Kundapoor | |
| Chief Accounting Officer: | TBD | |
| Chief Deployment Officer: | Gary Sawina | |
| Sales and Marketing Officer: | Anne Carley |
|
Such officers shall have the authority that is generally accorded to an individual with a similar title in a Delaware corporation.
|
|
| Development: |
The initial Development Plan will include the use cases that were developed by the parties for the Clearday residential community. Recommendations by each of the parties will be discussed amongst them regularly, at monthly meetings or at such other times as determined by the Board. Recommendations of either parties shall be discussed in meetings held with Tech./Implementation teams to test the feasibility before the Board can approve of such changes/iterations to the use cases / development plan as such.
Either of the parties can add additional content & services to the use cases based on – (a) Clearday’s knowledge & experience in treating residents & client with cognitive issues, and (b) Invento’s assessment of client requirement vis-à-vis the technological & financial feasibility of recommendations / iterations, if any.
|
| Distribution: |
The
distribution and marketing plan (the “Distribution Plan”) of the JV will be as from time to time determined by
the Board.
Clearday will provide an initial distribution and marketing plan for the approval of the Board on or prior to December 30, 2021. The Clearday designees to the Board will supervise the further development and modification of the Distribution Plan, subject to the approval of the Board. |
| 2 |
| 3 |
| JV Expenses: |
The Board will establish a financial budget for operating expenses of the JV (the “JV Budget”). The JV Budget will target operating expenses to be a percentage of the business revenues, including sales, rentals and leases, and will include interest or other financing costs that may be approved by the Board to finance the purchase of the Robots.
|
| Robot Purchases: |
The JV will acquire the Robots and related technologies at a cost that is generally considered to be wholesale price for the following components: (1) hardware at a fixed price per unit, (2) software and related operating systems at a monthly charge, and (3) Robot administrators and operators at a monthly charge. Most favored nations status will be provided to the JV for such purchases. Additionally, until the JV has sufficient revenues, the Robots will be sold to the JV at cost with the additional profit (wholesale price to cost) to be paid when the JV has sufficient cash resources.
|
| Content Resale and Purchases: |
The JV will acquire the Clearday at Home content at a cost that is generally considered to be its wholesale price that Clearday generally provides. Most favored nations status will be provided to the JV for such purchases. Additionally, until the JV has sufficient revenues, the Clearday at Home will be sold to the JV at cost with the additional profit (enterprise sales price to cost) to be paid when the JV has sufficient cash resources.
|
| Distributions: |
The distributions of net cash flow of the JV after the payment of expenses to third parties that are not affiliates of any JV member, shall be provided as follows:
1. To pay for the purchases of the Robots and the acquisition of content, equally on the basis of amounts owed to Invento and Clearday. 2. To pay the compensation (which is expected to be bonus compensation) to the officers of the JV; 3. To pay sales compensation as described in the then effective Distribution Plan. 4. To make distributions to the JV members as provided below:
|
| a. Invento | 33.33% | |
| b. Clearday | 33.33% | |
| c. Reserve for other members | 33.33% | |
| Total: | 100.00% |
|
The distributions provided above in clause (4) are subject to payment to a JV Member that provides cash investment to the JV for the payment of its operating expenses or otherwise, which distributions to cash investors will be not less than 10.25% return and then return of invested capital.
|
| 4 |
| Covenants: |
Each of Invento and Clearday will provide sufficient time and attention to the business of the JV and shall use their respective commercially reasonable efforts to advance the business of the JV.
The Robots shall not be sold to any person in the JV Core Business Market without the consent of Clearday or an appropriate payment of a reasonable commission to Clearday as determined by the Board in its reasonable good faith discretion. No Robots will be sold to a person that competes with Clearday in its businesses that are in the JV Core Business Market, without the consent of Clearday, which consent, shall be: (1) with respect to the digital service offerings of Clearday, in the sole and absolute discretion of Clearday; and (2) with respect to all other businesses, shall not be unreasonably withheld, delayed or conditioned.
Clearday will provide its content that is customarily provided in its business to the JV and not to any other manufacturer of robotics that have substantially similar functionality of the Robots in the JV Core Business Market.
|
| Termination of the JV: |
The term of the JV will be for 5 years with renewable 5 year terms; provided, that the Board will determine mutually agreeable revenue targets for the initial period ending June 30, 2023 and for the first six months thereafter and then for each annual period thereafter (each such period ending on December 31). The initial revenue target (for the initial period) shall be determined by the parties prior to December 31, 2021. If such targets are not established by such date and such date is not extended, then either party may terminate this JV upon 60 days’ notice.
In the event that a party so terminates this JV because such revenue targets are not satisfied, then the compensation and bonus compensation and distribution rights will continue in force until the expiration of all sales, leases and rentals that are exist on the date of such termination. Further, the party that does not elect to termination the JV, by initiate a buy / sell process to continue the business of the JV by either continuing to buy Robots at the wholesale price or acquire Clearday at Home at the wholesale price. Further, any such termination of the JV will not effect the rights to indemnification.
|
| Transfers: |
Invento and Clearday shall not have the right to transfer or assign any JV interests other than with the consent of the other party.
Any member other than Invento and Clearday may transfer only their respective economic right in the JV. Any transferee shall not be admitted as a member in the JV and be entitled only to the rights to distribution as noted above.
|
| Accounting / Books and Records: |
The accounting and finance functions shall be administered as reasonably determined by Invento and Clearday. Each such person shall have the right to inspect the books and records and have the independent accountants of the JV assist the independent accounts of Invento and Clearday with respect to their tax and accounting matters, including their respective annual audits.
|
| Miscellaneous: |
Any notice required or permitted to be given under this Agreement shall be sufficient if in writing, and if (i) sent by registered or certified mail to the other party’s place of business contained, or (ii) hand delivered to the intended party and written evidence thereof is obtained.
This Agreement shall be construed and administered in accordance with the laws of the State of Texas, excluding conflict of laws provisions.
Any dispute shall be resolved through JAMS arbitration in Texas.
This Agreement contains the entire understanding of the parties with respect to the subject matter. All prior promises, understandings, or agreements are merged into this Agreement. |
| 5 |
IN WITNESS WHEREOF, each of the parties have executed and delivered this Agreement as of the date set forth below the signature of such person.
| Invento Research Inc. | ||
| By: | /s/ Balaji Viswanathan | |
| Balaji Viswanathan, CEO | ||
| November 11, 2021 | ||
| Clearday Management Ltd., | ||
| By: | /s/ Richard M. Morris | |
| Richard M. Morris, EVP | ||
| November 11, 2021 | ||
| 6 |
Exhibit 99.1
Clearday Inc. Enters Into Agreement With Invento Research Inc. and Schedules Demonstration
Clearday brings automation to healthcare through robots
SAN ANTONIO, Texas Nov. 12, 2021 /PRNewswire/ — Clearday, Inc. (OTCQB: CLRD) today announced a Joint venture with Invento Research Inc., an ISO 9001:2015 certified company, to bring the latest robotic technology to the senior care world. Together, the two companies are developing and deploying “Mitra”, a trusted companion, with proprietary uses that encourage patient engagement and enhances and empowers care workers with abundant convenience. Mitra will soon be launched to support non-acute care markets, including deployment in Clearday residential communities, and in the home markets with Clearday at Home to better enable older Americans to age-in-place.
James Walesa CEO of Clearday stated, “Our work with Invento is developing a trusted companion that provides fun and engaging content for older Americans while also supporting, and protecting, their care givers. Mitra is developing routines that enable care workers to safely, efficiently, and effectively provide more and better care. Perhaps most importantly, Mitra provides these services in a fun, entertaining and engaging way – our residents are not intimidated by the technology, they quickly embrace and enjoy it. We believe this is the beginning of merging robotic technology and personal care and engagement to improve the quality of life for all patients.”
“We introduced Mitra to the seniors at our Primrose Adult daycare facility in San Antonio, Texas on Veterans Day,” continued Mr. Walesa. “We demonstrated how Mitra uses the power of voice, vision, machine learning and onboard devices to deliver quality and engaging care. We will soon be launching Mitra in each of our facilities and partnering with other locations so that Mitra can provide a better care experience for even more people.”
“We are pleased to be working with Clearday,” said Balaji Viswanathan, co-founder and CEO of Invento Research Inc. He added, “We are looking forward to combining our well established expertise in robotic technology with Clearday’s extensive work in senior care to provide the strongest and friendliest support for older Americans that choose to age in place.”
About
Clearday™
Clearday™ is an innovative non-acute longevity health care services company with a modern, hopeful vision for making high quality care options more accessible, affordable, and empowering for older Americans and those who love and care for them. Clearday has decade-long experience in non-acute longevity care through its subsidiary Memory Care America, which operates highly rated residential memory care communities in four U.S. states. Clearday at Home – its digital service – brings Clearday to the intersection of telehealth, Software-as-a-Service (SaaS), and subscription-based content.
Learn
more about Clearday at www.myclearday.com.
Learn more about Clearday at Home at www.cleardayathome.com.
Learn more about Clearday Clubs at clubs.myclearday.com.
Learn more about the Clearday Network at https://business.cleardayathome.com
Learn more about Invento Research Inc. at https://mitrarobot.com
Forward Looking Statements
This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are, or may
be deemed to be, forward-looking statements. In some cases, forward-looking statements can be identified by the use of terms such as
“anticipate,” “estimate,” “believe,” “continue,” “could,” “intend,”
“may,” “plan,” “potential,” “predict,” “should,” “will,” “expect,”
“objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,”
“effort,” “target,” “trajectory,” “focus,” “work to,” “attempt,”
“pursue,” or other comparable terms. However, the absence of these words does not mean that the statements are not forward-looking.
These forward-looking statements are based on certain assumptions and analyses made by us in light of our experience and our perception
of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate in the
circumstances and are not guarantees of future performance. Actual results may differ materially from those indicated by forward-looking
statements as a result of various factors, risks and uncertainties. These forward-looking statements should not be relied upon as representing
Clearday’s views as of any date subsequent to the date hereof. Except as required by applicable law, Clearday undertakes no obligation
to revise or update any forward-looking statement, or to make any other forward-looking statements, whether as a result of new information,
future events or otherwise.
Investor
Relations
Andrew Barwicki
516-662-9461 / andrew@barwicki.com