Grand Samsara Consulting LLC and CBGB Ventures Corp. signed a binding letter agreement to acquire Zenith Capital Corporation (TSXV:ZENI.P) in a reverse merger transaction.
A concurrent private placement is anticipated to be completed by CBGB for minimum gross proceeds of CAD 1.5 million and by Zenith for minimum gross proceeds of CAD 1 million on or prior to the closing of the transaction. The board of directors and management of Zenith is expected to be reconstituted upon completion of the Proposed Transaction, with one current director of Zenith resigning and each of Zenith and Grand Samsara nominating two directors for appointment to the board of the Resulting Issuer. Zenith and Grand Samsara will jointly nominate a fifth director, to be nominated for election at the next annual general meeting of the Resulting Issuer. Zenith is expected to assume the management contracts of certain key Grand Samsara executives in connection with the transaction. The transaction is subject to various conditions, including: completion of mutually satisfactory due diligence; Zenith entering into a definitive agreement with each of Grand Samsara and CBGB in respect of the transaction; each of Zenith and CBGB entering into the Loan Agreement with Grand Samsara, and each party thereto being in good standing with respect to their obligations thereunder; completion of the Private Placements on or prior to closing; the assumption of the Key Management Contracts on or prior to closing; and the receipt of all requisite regulatory approvals relating to the transaction, including, without limitation, approval of the TSXV, the boards of directors of Zenith, Grand Samsara and CBGB, and the shareholders of Grand Samsara, CBGB and Zenith, if applicable. As the proposed transaction is an arm's length transaction, Zenith does not expect to obtain shareholder approval for the transaction. The transaction will be subject to approval by the shareholders of Grand Samsara and CBGB.