Zonetail Closes Initial Tranche of Private Placement Financing; Raises $350,000

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) HAS APPROVED OR ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

TORONTO, Oct. 16, 2019 —  Zonetail Inc. (the “Company” or “Zonetail”) (TSX-V:ZONE) is pleased to announce that further to its news release dated September 3, 2019, it has closed the first tranche of its non-brokered private placement of convertible debt securities generating aggregate gross proceeds of $350,000 (the “Offering”).

The Offering involves the issuance of unsecured convertible notes bearing interest at 10%, with a 24 month term from issuance, and providing for a conversion price of $0.06 per share.  The notes are convertible if the Company’s shares trade in excess of $0.10 over any period of 10 trading days during the term, whether or not consecutive.  The notes may also be extended for an additional 12 months by the Company or may be prepaid, subject in each case to certain bonus payments.  The Company may, at its option, make payment of such interest and bonus amounts due in cash or in common shares, subject to the receipt of any required regulatory or stock exchange approvals.  The proceeds from the Offering will be used for sales and marketing activities, as well as general working capital purposes.

The securities underlying the Notes issued on closing of the Offering are all subject to a four-month statutory hold period. No commissions or fees were payable in connection with this financing.

The Company may pursue additional closings of subscriptions under the Offering prior to December 31, 2019, up to a maximum aggregate amount of $1,000,000, and subject to the receipt of any required regulatory or stock exchange approvals.

About Zonetail

Zonetail is a mobile platform for hotels and condominiums providing guests and residents access and interaction with building amenities and services as well as neighboring restaurants, stores, services, and attractions.

Zonetail is partnered with AAHOA, the largest association of hoteliers in the world, representing over 25,000 hotels and 50% of the US market. Zonetail is also partnered with Shiftsuite, one of the largest property management system software providers to the condo industry in Canada, with approximately 2,000 condo buildings, representing an estimated 400,000 units. Zonetail has offices in Toronto, Ontario and San Dimas, California.

For more information, please visit https://www.zonetail.com.

Zonetail trades under the symbol “ZONE” on the Toronto Venture Stock Exchange.

Zonetail Press Contact

Mark Holmes, President and CEO Zonetail Inc.
Telephone: (416) 583-3773 ext. 228 mark@zonetail.com

Regulatory Statements

This press release contains “forward-looking information” within the meaning of applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, statements with respect to the closing of the Private Placement or the use of proceeds of the Private Placement.  Generally, forward looking information can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: general business, economic and competitive uncertainties; regulatory risks; risks inherent in technology operations; and other risks of the technology industry. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States.  The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or any state securities laws and may not be offered or sold within the United States or to, or for the account or benefit of U.S. persons (as defined in Regulation S under the 1933 Act) absent such registration or an applicable exemption from such registration requirements.