ZoomAway Announces Proposed Shares-for-Debt and Loan Transactions

Rhea-AI Summary

ZoomAway Travel Inc. (TSXV:ZMA)(OTCQB:ZMWYF) has announced a shares-for-debt transaction to settle $985,000 of existing debt with AIP Convertible Private Debt Fund. The settlement involves issuing 65,716,666 common shares at $0.015 each and purchase warrants exercisable at $0.05 for five years. Following the transaction, AIP will hold approximately 48.8% of the company. Additionally, a new loan agreement for US$5 million is anticipated for future acquisitions, subject to TSXV and shareholder approval.

Positive

• Debt settlement reduces existing liabilities by $985,000.
• New loan agreement expected to provide US$5 million for potential growth.
• Compliance with all covenants under the Note Purchase Agreement.

Negative

• Issuance of new shares may dilute current shareholders' ownership.
• Dependence on shareholder approval for Debt Settlement.

VANCOUVER, BC / ACCESSWIRE / November 5, 2020 / ZoomAway Travel Inc. (TSXV:ZMA)(OTCQB:ZMWYF) (the "Company" or "ZMA") www.zoomaway.com, is pleased to announce that it will file a shares-for-debt transaction with the TSX Venture Exchange (the "TSXV") in respect of $985,000 of existing debt (the "Debt"). The Debt being settled is part of a series of non-convertible notes that were issued to AIP Convertible Private Debt Fund L.P. ("AIP") pursuant to the Note Purchase Agreement announced on May 17, 2019, as amended from time to time (the "NPA"). The Debt is set to mature on November 30, 2020. The Company confirms that as of the end of its most recently completed fiscal quarter (September 30, 2020), that it was in compliance with all affirmative covenants in the NPA and is otherwise in good standing with AIP. The Company proposes to settle the Debt by issuing to AIP a total of 65,716,666 common shares of the Company at a deemed price of $0.015 per share and 65,716,666 common share purchase warrants (the "Debt Settlement"). Each warrant will be exercisable for a period of 60 months from the date of issuance at an exercise price of $0.05 each. After giving effect to the Debt Settlement, the Company will have a total of approximately 142,360,338 shares issued and outstanding, with AIP holding approximately 48.8% on an undiluted basis.

The Debt Settlement is subject to the approval of the TSXV. As the Debt Settlement will result in the creation of a new "control person" as defined under TSXV policies, the Debt Settlement is also subject to shareholder approval, which approval will be sought at the Company's annual and special meeting of shareholders scheduled for December 16, 2020.

The pricing of the common shares issuable pursuant to the Debt Settlement is in reliance of the temporary relief measures established by the TSXV on April 8, 2020, and extended by the TSXV on September 16, 2020, providing for temporary relief measures to its Policy 4.3, lowering the minimum pricing from $0.05 to $0.01 per share for shares issued pursuant to a debt settlement where the market price of an issuer's shares is not greater than $0.05. The market price of the Company's common shares at close of business on October 28, 2020 was $0.015.

Further to the Debt Settlement and upon TSXV and shareholder approval, the Company will enter into a new loan agreement with AIP whereby it will provide a US$5 million (US$5,000,000) facility for future acquisitions. It is anticipated that the loan will have the following features: (i) a 24-month term; (ii) an interest of rate of 5% per annum; (iii) a due diligence fee of US$100,000; (iv) a facility fee of US$100,000; and (iv) a closing fee of US$1,800,000.

"The pandemic has been very challenging for ZoomAway and the Tourism Industry as a whole," commented Sean Schaeffer, CEO, "We are thankful that AIP is willing to provide funds for the Company to expand. We believe that with the Debt Settlement, together with the new funding for potential acquisitions, that the Company can look forward to a stronger 2021."

All securities issuable in respect of the Debt Settlement will be subject to a statutory hold period expiring on the date that is four months and one day after the distribution date. None of the securities issuable in connection with the Debt Settlement will be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

For additional information contact: Sean Schaeffer, President, ZoomAway Inc., at 775-691-8860 | sean@zoomaway.com or stay up-to-date and sign up for our newsletter.

About Us

ZoomAway, Inc. (Nevada Co.) ZoomAway Travel Inc. is a technology company that is revolutionizing the Hospitality and Travel Industries. We have developed a variety of software solutions that enhance the planning and engagement of everyday tourists. Our flagship project, ZoomedOUT, is a complete modernization and re-imagination of mobile travel apps. In a full 3D environment, we are able to integrate planning, booking, social media, and camaraderie into a tangibly rewarding experience. We are combining Travel, Hospitality, Mobile Gaming and Augmented Reality to change the way users travel into 2020 and beyond. Additional information about ZoomAway Inc. can be found at www.zoomaway.com.

ZMA Travel Game Inc. (Canadian Co.) (formerly TravelGameBlockChain Technology Inc.) is a ZoomAway Travel Inc. subsidiary company dedicated to housing new projects in the digital games. The company's first project is ZoomedOUT, being developed with the assistance of Zero8 Studios, Inc., which can be seen at zoomedout.io. To receive more detailed, or investor level information, please contact us at sean@zoomaway.com and we will respond with the appropriate documentation depending on your request.

Forward-Looking Statements
This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address events or developments that the Company expects to occur, are forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in the forward-looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include regulatory actions, market prices, and continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. Forward-looking statements are based on the beliefs, estimates, and opinions of the Company's management on the date the statements are made. Except as required by applicable securities laws, the Company undertakes no obligation to update these forward-looking statements in the event that management's beliefs, estimates or opinions, or other factors, should change.

Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE: ZoomAway Travel Inc.

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FAQ

What is the shares-for-debt transaction by ZoomAway Travel Inc.?

ZoomAway is proposing to settle $985,000 in debt by issuing 65,716,666 shares and warrants to AIP Convertible Private Debt Fund.

What are the terms of the new loan agreement with AIP?

The new loan agreement is for US$5 million with a 24-month term and a 5% annual interest rate.

How will the debt settlement affect ZoomAway's shareholders?

The debt settlement may dilute existing shareholders' ownership as new shares are issued.

When is the shareholder meeting for approving the debt settlement?

The shareholder meeting is scheduled for December 16, 2020.

What are the immediate financial impacts of the debt settlement for ZoomAway?

The debt settlement will reduce liabilities and is expected to strengthen the company’s financial position going into 2021.