Sounds like a way for Zenith to split off the royalty preferred shares from the rest of the "technology" of the company so that they will be separate entities. "Zenith Capital Corp" will establish a RVX-208 royalty stream that is not directly tied to Zenith Epigenetics. IMO, this is making it an easier path to an IPO that values the Newco Zenith Epigenetics entirely on its technology and not on the royalty stream of RVX-208. I guess this means that there will be 34.4 million shares outstanding of Zenith Epigenetics when all is said and done that are entirely owned by Zenith Capital Corp. And current owners of Zenith don't have to worry about dilution of the value of their royalty preferred shares with the issuance of new shares in an IPO or other dilutive financing for the future Zenith Epigenetics.

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"The Transaction will result in the Technology and the Royalty Preferred Shares being owned by separate entities. This structure is expected to enhance the ability of each of the Corporation and Newco to pursue corporate objectives and strategies that are suited to their respective assets. In addition, this structure will enable each entity to obtain independent access to capital which management believes will facilitate efforts to obtain funding necessary for the development of the Technology, while minimizing future dilution of the interest of shareholders in the Royalty Preferred Shares.

The Corporation will initially own all of the securities of Newco, so there will not be any immediate change in the ultimate beneficial ownership of the Technology. In addition, the Corporation may make additional capital contributions to Newco to fund its operating activities in the near term. However, it is anticipated that Newco will also raise capital from other sources to fund research and development activities relating to the Technology, which will reduce the relative interest of the Corporation in the Technology.

Newco is a corporation incorporated under the ABCA. All of the outstanding common shares of Newco are currently owned by the Corporation and, after giving effect to the Transaction, Newco will continue to be a wholly-owned subsidiary of the Corporation. Mr. Donald McCaffrey, the President and Chief Executive Officer of the Corporation, is currently the only director and officer of Newco. Upon completion of the Transaction, it is anticipated that additional directors and officers will be appointed.

Summary of Principal Terms of the Asset Purchase Agreement Pursuant to an Asset Purchase Agreement dated November 30, 2015 (the “Asset Purchase Agreement”), the Corporation agreed to sell and Newco agreed to purchase all of the assets of the Corporation, excluding the Royalty Preferred Shares and certain receivables (the “Transferred Assets”) for a purchase price of US$34.4 million (the “Purchase Price”) which will be satisfied by the issuance to the Corporation of 34.4 million Class A common shares of Newco at a deemed price of US$1.00 per share. Pursuant to the terms of the Asset Purchase Agreement, Newco also agreed to assume certain trade payables and other liabilities in the aggregate amount of approximately US$4.6 million (the “Assumed Liabilities”)."