An anonymous director reports

ZTEST ANNOUNCES CLOSING OF FINAL TRANCHE OF PRIVATE PLACEMENT OFFERING AND AMENDMENT OF LOI WITH TWENTY49 LTD

Ztest Electronics Inc. will be closing the final tranche of its non-brokered private placement, announced on Dec. 17, 2018, and Dec. 27, 2018, with the sale of 340,000 working capital units at 30 cents per unit for gross proceeds of $102,000, on Jan. 31, 2019.

Each unit consists of one common share and one-half of a common share purchase warrant. Each full warrant entitles the holder to acquire an additional common share of the company at 40 cents for 18 months from closing. Eligible finders will be paid $4,620 and be issued 15,400 broker warrants. Each broker warrant entitles the holder to acquire one common share of Ztest at 30 cents for 18 months from closing. All securities issued pursuant to the final tranche of the offering will be subject to a statutory hold period expiring on June 1, 2019.

The proceeds of the offering will be used for working capital and to invest in Twenty49 Ltd., based in Waterloo, Ont., and operating in the United States through its wholly owned subsidiary as disclosed in the Dec. 17, 2018, press release. A new letter of intent has been signed to replace the one announced on Dec. 17, 2018. Pursuant to the new LOI, the company will invest $112,000 to acquire approximately 5.6 million founder shares, representing not less than 30.27 per cent of the current issued and outstanding voting securities of Twenty49 Ltd., and 8.2 million founder warrants exercisable at 2.5 cents per share, or $205,000 in total, on or before May 31, 2019. A subsequent round of financing will be completed by Twenty49 on or before May 31, 2019, and if the company chooses to exercise the founder warrants, it will hold not less than 34.84 per cent of the voting securities of Twenty49 Ltd. after giving effect to the subsequent round of financing. The payment of the subscription price will be conditional upon, among other things, delivery of a detailed use of proceeds for the subscription price, upon Ztest raising financing by way of a private placement of at least $200,000, which condition will be satisfied with the completion of the final tranche of the offering, and upon execution of a subscription agreement containing customary terms and conditions for transactions of this nature. The company will have until Feb. 8, 2019, to complete its due diligence and it is anticipated that the subscription agreement will be executed and the subscription price paid by Feb. 15, 2019, but in any event the transaction must be completed no later than March 15, 2019.

An insider of the company subscribed for 70,000 units of the offering. The insider private placement is exempt from the valuation and minority shareholder approval requirements of Multilateral Instrument 61-101 by virtue of the exemptions contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101 in that the fair market value of the consideration for the securities of the company issued to the insider did not exceed 25 per cent of its market capitalization.

About Ztest Electronics Inc.

Ztest Electronics, through its wholly owned subsidiary Permatech Electronics Corp., offers electronic manufacturing services (EMS) to a wide range of customers. Permatech's offering includes materials management, printed circuit board (PCB) assembly, testing and design services. Permatech operates from a 20,000-square-foot, ISO 9001:2015-certified facility in North York, Ont., Canada.