21:53:26 EST Tue 10 Dec 2019
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Zenyatta Ventures Ltd
Symbol ZEN
Shares Issued 64,909,054
Close 2018-11-16 C$ 0.42
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Zenyatta closes $583,000 tranche of placement

2018-11-16 19:02 ET - News Release

Mr. Brian Bosse reports


Zenyatta Ventures Ltd. is updating shareholders regarding its finance position and communication strategy. Between closing a tranche of the previously announced private placement and conversion of certain accounts payable into equity, the company had liquidity that improved by $797,985.48. Details for these events are described below.

Tranche closing of private placement

The company announces closing of a tranche of its previously announced private placement. The company raised approximately $583,000 in respect of this tranche, which will be used to finance continuing work on the Albany graphite project and for general corporate purposes. The board of directors of Zenyatta wishes to thank all the long-term Zenyatta shareholders, and all the new shareholders, who participated in the offering. Subsequent tranche closings will be announced as they occur.

The offering consisted of the issuance of 1,295,553 units at a price of 45 cents per unit, for aggregate gross proceeds of $582,995.95. Each unit consisted of one common share of the company and one-half of one non-transferable share purchase warrant. Each whole warrant will entitle the holder thereof to acquire one additional common share at an exercise price of 60 cents per warrant, exercisable for a period of 24 months from the closing of the offering. Insiders of the company have subscribed for approximately 48 per cent of the offered units.

All warrants issued in connection with the offering are subject to an acceleration clause. If the company's share price trades at or above $1 per share for a period of 10 consecutive trading days during the exercise period, the company may accelerate the expiry date of the warrants to 30 calendar days from the date on which written notice is given by the company to the holders of the warrants.

Certain insiders of the issuer participated in the offering. Such participation represents a related-party transaction under Multilateral Instrument 61-101 (Protection of Minority Security Holders in Special Transactions), but the transaction is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 as neither the fair market value of the subject matter of the transaction, nor the consideration paid, exceed 25 per cent of the issuer's market capitalization. The offering was approved by all independent directors of the company.

The common shares and the warrants issued in connection with the offering will be subject to a hold period until March 17, 2019, in accordance with applicable securities laws.

Shares-for-debt agreements

Zenyatta also announces that, subject to approval of the TSX Venture Exchange, it has entered into agreements to issue shares to settle an aggregate amount of $214,989.53 owed to certain trade creditors. The company will be issuing 477,755 common shares at a deemed price of 45 cents per common share in settlement of the above-noted amount.

All securities issued in exchange for debt will be subject to a hold period from the date of issuance in accordance with applicable securities laws.

Social media platform

The company announces the launch of a chief-executive-officer-verified discussion forum on Agoracom. The forum will serve as the company's primary social media platform to interact with both shareholders and the broader investment community in a fully moderated environment.

The Zenyatta discussion forum can be found at the Agoracom website. Verified officers at launch are: Dr. Francis Dube, Phil Chataigneau and Dr. Colin van der Kuur.

Subject to TSX Venture Exchange approval, the company will issue shares to Agoracom in exchange for services at the rate of $10,000 per quarter, in addition to an initial retainer of $10,000. The number of common shares to be issued at the end of each period will be determined by using the closing price of the common shares of the company on the TSX Venture Exchange on the first trading day following the end of each period for which the services were provided by Agoracom. The term of the agreement is for 12 months, effective Oct. 15, 2018.

We seek Safe Harbor.

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