Calgary, Alberta--(Newsfile Corp. - May 12, 2026) - Zenith Capital Corp. ("Zenith" or the "Company") today announces the amendment of an aggregate amount of US$11.1 million and CAD$6.7 million of promissory notes (the "Notes") held by an immediate family member (the "Lender") of Zenith's Chairman and CEO and entities controlled by the Lender to: (i) increase the interest rate for all Notes from 11% to 18% per annum, commencing effective February 1, 2026, (ii) to grant the Lender conversion privileges entitling the Lender to convert some or all of the outstanding principal amount of the amended notes and accrued and unpaid interest thereon into common shares of the Company at a conversion price of US$0.60 per share commencing on May 11, 2026; and (iii) to restate the aggregate amount of all Canadian dollar-denominated Notes into US dollar-denominated Notes based on the exchange rate on the date of the amendment. Post-amendment, the aggregate principal amount and accrued and unpaid interest total US$16.0 million and US$0.7 million, respectively. The conversion of the entire principal amount of the amended Notes and accrued and unpaid interest thereon would result in the issuance of approximately 28 million common shares of the Company representing approximately 14.9% of the Company's issued and outstanding common shares. The Notes are payable within 45 days following demand and are secured by a security interest in all of the Company's assets.
In addition to holding the Notes, the Lender also holds approximately 1.3 million Zenith common shares and approximately 28.0 million Zenith common share purchase warrants (the "Warrants"), each exercisable at prices between US$0.60 and US$0.75 per share until between January 27, 2027 and May 4, 2031. Assuming the conversion of all of the Lender's Notes and the exercise of all of the Lender's Warrants, the Lender would hold approximately 57.2 million common shares of the Company, representing in aggregate approximately 26.5% of the Company's common shares.
Related Party Considerations
The amendment to the Notes is considered a "related party transaction" within the meaning of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101") as the Lender is considered a "related party" of the Company within the meaning of MI 61-101. The Company is exempt from the formal valuation and minority shareholder approval requirements under MI 61-101 in reliance on the exemptions set out in sections 5.5(a) and 5.7(1)(a), respectively, of MI 61-101 as the fair market value of the transaction is not more than 25% of the Company's market capitalization. The Company did not file a material change report more than 21 days before closing as the details of the transaction were not settled until shortly prior to closing and the Company wished to close on an expedited basis for sound business reasons.
Early Warning Disclosure
Prior to the transaction, Ten Peaks Valley Ltd. and other entities controlled by the Lender, beneficially owned and controlled 1,333,333 common shares of Zenith, 27,950,000 Warrants and non-convertible promissory notes in the principal amount of US$11.1 million and CAD$6.7 million and, assuming exercise of the Warrants, the Lender would have held an aggregate of 29,283,333 common shares, representing 15.6% of the issued and outstanding common shares. Following the Transaction, the Lender held 1,333,333 common shares, 27,950,000 Warrants and US$16 million principal amount of Notes and accrued and unpaid interest thereon convertible into 27,934,311 common shares and, assuming exercise of the Warrants and conversion of the Notes, the Lender would hold an aggregate of 57,217,644 common shares, representing 26.5% of the issued and outstanding common shares. The Lender advises that the Notes were acquired for investment purposes. The Lender may, depending on market and other conditions, acquire or dispose of Notes or other securities of the Company. This disclosure is provided pursuant to Multilateral Instrument 62-104 - Takeover Bids and Issuer Bids, which also requires an early warning report to be filed containing additional information with respect to the foregoing matters. A copy of the early warning report will be available on SEDAR+ under Zenith's issuer profile at www.sedarplus.ca and may be obtained upon request from the Company at: 300, 4820 Richard Road SW, Calgary, AB, T3E 6L1. Attention: Brad Cann, Chief Financial Officer; Telephone number: (587) 390-7865.
ZEN-3694
Zenith's lead clinical candidate, ZEN-3694, is currently being evaluated in two (2) active NUT carcinoma clinical trials in combination with abemaciclib (ClinicalTrials.gov ID: NCT05372640) and cisplatin & etoposide (ClinicalTrials.gov ID: NCT05019716). ZEN-3694 is a potent, selective, orally available BET inhibitor, which is well tolerated for chronic administration and has a favorable safety profile, with more than 550 patients having received the drug. In NUT carcinoma, the NUTM1 gene is fused with a transcriptional regulator - most commonly a BET protein - and drives expression of cancer-causing genes, leading to unchecked growth of tumors. Through disrupting the activity of NUT fusion protein, ZEN-3694 has demonstrated both single-agent and combination efficacy in treating NUT carcinoma. To date, the combination of abemaciclib plus ZEN-3694 has shown superior response rate and duration of response compared to single agent BET inhibitors by inhibiting resistance to therapy. ZEN-3694 has received FDA Fast Track and Orphan Drug designations for its NUT carcinoma program.
About Zenith
Zenith Epigenetics Ltd., a wholly owned subsidiary of Zenith Capital Corp., is a clinical stage biotechnology company focused on the discovery and development of novel therapeutics for the treatment of cancer and other disorders with significant unmet medical need. Zenith Epigenetics is developing various novel combinations of BET inhibitors with other targeted agents. Our lead compound, ZEN-3694, is in clinical development for various oncologic indications such as metastatic castration resistant prostate cancer, NUT carcinoma, ovarian cancer, colorectal cancer, breast cancer, squamous cell lung cancer and other solid tumors. Several of these studies are sponsored by the NCI under the NCI-Zenith Cooperative Research & Development Agreements ("CRADA") and CRADAs between NCI and other NCI collaborators.
Forward-Looking Statement
This news release may contain certain forward-looking information as defined under applicable Canadian securities legislation, that are not based on historical fact, including without limitation statements containing the words "believes", "anticipates", "plans", "intends", "will", "should", "expects", "continue", "estimate", "forecasts" and other similar expressions. In particular, this news release includes forward looking information relating to the Company's development activities involving ZEN-3694 in NUT carcinoma, prostate cancer, ovarian cancer, lung cancer, breast cancer, colorectal cancer, and other tumor types, as a single agent, or in combination with chemotherapies, as well as our partnerships, agreements, and collaborations in furtherance of these development activities. Our actual results, events or developments could be materially different from those expressed or implied by these forward-looking statements. We can give no assurance that any of the events or expectations will occur or be realized. By their nature, forward-looking statements are subject to numerous assumptions and risk factors including those discussed in our most recent MD&A which are incorporated herein by reference and are available through SEDAR+ at www.sedarplus.ca. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement and are made as of the date hereof. Zenith disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For further information, please contact:Investor Relations
Phone: 587-390-7865
Email: info@zenithepigenetics.com
Website: www.zenithepigenetics.com
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/297094
In addition to holding the Notes, the Lender also holds approximately 1.3 million Zenith common shares and approximately 28.0 million Zenith common share purchase warrants (the "Warrants"), each exercisable at prices between US$0.60 and US$0.75 per share until between January 27, 2027 and May 4, 2031. Assuming the conversion of all of the Lender's Notes and the exercise of all of the Lender's Warrants, the Lender would hold approximately 57.2 million common shares of the Company, representing in aggregate approximately 26.5% of the Company's common shares.
Related Party Considerations
The amendment to the Notes is considered a "related party transaction" within the meaning of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101") as the Lender is considered a "related party" of the Company within the meaning of MI 61-101. The Company is exempt from the formal valuation and minority shareholder approval requirements under MI 61-101 in reliance on the exemptions set out in sections 5.5(a) and 5.7(1)(a), respectively, of MI 61-101 as the fair market value of the transaction is not more than 25% of the Company's market capitalization. The Company did not file a material change report more than 21 days before closing as the details of the transaction were not settled until shortly prior to closing and the Company wished to close on an expedited basis for sound business reasons.
Early Warning Disclosure
Prior to the transaction, Ten Peaks Valley Ltd. and other entities controlled by the Lender, beneficially owned and controlled 1,333,333 common shares of Zenith, 27,950,000 Warrants and non-convertible promissory notes in the principal amount of US$11.1 million and CAD$6.7 million and, assuming exercise of the Warrants, the Lender would have held an aggregate of 29,283,333 common shares, representing 15.6% of the issued and outstanding common shares. Following the Transaction, the Lender held 1,333,333 common shares, 27,950,000 Warrants and US$16 million principal amount of Notes and accrued and unpaid interest thereon convertible into 27,934,311 common shares and, assuming exercise of the Warrants and conversion of the Notes, the Lender would hold an aggregate of 57,217,644 common shares, representing 26.5% of the issued and outstanding common shares. The Lender advises that the Notes were acquired for investment purposes. The Lender may, depending on market and other conditions, acquire or dispose of Notes or other securities of the Company. This disclosure is provided pursuant to Multilateral Instrument 62-104 - Takeover Bids and Issuer Bids, which also requires an early warning report to be filed containing additional information with respect to the foregoing matters. A copy of the early warning report will be available on SEDAR+ under Zenith's issuer profile at www.sedarplus.ca and may be obtained upon request from the Company at: 300, 4820 Richard Road SW, Calgary, AB, T3E 6L1. Attention: Brad Cann, Chief Financial Officer; Telephone number: (587) 390-7865.
ZEN-3694
Zenith's lead clinical candidate, ZEN-3694, is currently being evaluated in two (2) active NUT carcinoma clinical trials in combination with abemaciclib (ClinicalTrials.gov ID: NCT05372640) and cisplatin & etoposide (ClinicalTrials.gov ID: NCT05019716). ZEN-3694 is a potent, selective, orally available BET inhibitor, which is well tolerated for chronic administration and has a favorable safety profile, with more than 550 patients having received the drug. In NUT carcinoma, the NUTM1 gene is fused with a transcriptional regulator - most commonly a BET protein - and drives expression of cancer-causing genes, leading to unchecked growth of tumors. Through disrupting the activity of NUT fusion protein, ZEN-3694 has demonstrated both single-agent and combination efficacy in treating NUT carcinoma. To date, the combination of abemaciclib plus ZEN-3694 has shown superior response rate and duration of response compared to single agent BET inhibitors by inhibiting resistance to therapy. ZEN-3694 has received FDA Fast Track and Orphan Drug designations for its NUT carcinoma program.
About Zenith
Zenith Epigenetics Ltd., a wholly owned subsidiary of Zenith Capital Corp., is a clinical stage biotechnology company focused on the discovery and development of novel therapeutics for the treatment of cancer and other disorders with significant unmet medical need. Zenith Epigenetics is developing various novel combinations of BET inhibitors with other targeted agents. Our lead compound, ZEN-3694, is in clinical development for various oncologic indications such as metastatic castration resistant prostate cancer, NUT carcinoma, ovarian cancer, colorectal cancer, breast cancer, squamous cell lung cancer and other solid tumors. Several of these studies are sponsored by the NCI under the NCI-Zenith Cooperative Research & Development Agreements ("CRADA") and CRADAs between NCI and other NCI collaborators.
Forward-Looking Statement
This news release may contain certain forward-looking information as defined under applicable Canadian securities legislation, that are not based on historical fact, including without limitation statements containing the words "believes", "anticipates", "plans", "intends", "will", "should", "expects", "continue", "estimate", "forecasts" and other similar expressions. In particular, this news release includes forward looking information relating to the Company's development activities involving ZEN-3694 in NUT carcinoma, prostate cancer, ovarian cancer, lung cancer, breast cancer, colorectal cancer, and other tumor types, as a single agent, or in combination with chemotherapies, as well as our partnerships, agreements, and collaborations in furtherance of these development activities. Our actual results, events or developments could be materially different from those expressed or implied by these forward-looking statements. We can give no assurance that any of the events or expectations will occur or be realized. By their nature, forward-looking statements are subject to numerous assumptions and risk factors including those discussed in our most recent MD&A which are incorporated herein by reference and are available through SEDAR+ at www.sedarplus.ca. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement and are made as of the date hereof. Zenith disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For further information, please contact:Investor Relations
Phone: 587-390-7865
Email: info@zenithepigenetics.com
Website: www.zenithepigenetics.com
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/297094
