KOO – Yes, as you can see in red below, all of the Royalty Preferred Shares are owned by ZCC. Any monies owing on the RPS’s would be paid to ZCC and it would be up to the ZCC BoD as to whether they dividend any out to ZCC shareholders. DM stated Thursday that his preference is to get some money to shareholders rather than just re-investing in other research and development. Note below that this isn’t just on Apabetalone rather any RVX pharmaceutical product .  I believe that if any or all of RVX is sold, the buyer has to pay the royalties to ZCC or negotiate a buyout for them. Either way is cash to ZCC.

From Resverlogix MD&A:

“the holder of royalty preferred shares is entitled to a dividend, calculated based on a percentage of net revenue earned from the sale or licensing of any pharmaceutical product in which Resverlogix holds an intellectual property right,”

From Zenith Capital Corp. MD&A:

“As at July 31, 2022, we hold all 75,202,620 royalty preferred shares of Resverlogix. We, as the sole holder of the royalty preferred shares of Resverlogix, are entitled to dividends in the amount of 6-12% of Resverlogix’s Net Revenue, if any. Net Revenue is defined as the aggregate of the following amounts: (i) amounts received by Resverlogix or its affiliates (as defined in the Plan of Arrangement signed June 3, 2013 ("the Arrangement")) from any person who is not Resverlogix or its affiliate (a “third party”) in consideration for granting a license or other rights to the third party which entitle the third party to research, develop, make, manufacture, modify, administer, offer to sell, sell or distribute one or more of Resverlogix’s products and/or intellectual property rights or amounts received under the terms of such license or other right that are granted to the third party; (ii) the gross consideration received from a third party by Resverlogix, any licensee or their respective affiliates from the sale of any product (other than consideration received by Resverlogix, any licensee or their respective affiliates from a licensee of such product or its affiliate); less (A) credits or allowances, if any, actually granted; (B) discounts actually allowed; (C) freight, postage, and insurance charges and additional special packaging charges; (D) customs duties, and excise sales taxes, duties or other taxes imposed upon and paid with respect to such sales (excluding what is commonly known as income taxes); (E) rebates and chargebacks or retroactive price reductions made to federal, state or local 7 governments (or their agencies), or any third party payor, administrator or contractor, including managed health organizations; and (F) commissions related to import, distribution or promotion of any product paid to third parties (specifically excluding any commissions paid to sales personnel, sales representatives and sales agents who are employees or consultants of, or members of a contract sales force engaged by or on behalf of, Resverlogix, any licensee or their respective affiliates); and (iii) amounts received from a third party by Resverlogix or its affiliates in consideration for the sale of any intellectual property right.”

NBB – If Zenith does a license deal, it doesn’t benefit a ZCHLF shareholder with cash instantly but should raise the value of those shares. Hopefully, it would drive the trading price (even OTC) up so you can sell for more than you bought at. There is a benefit right there. The cash received by ZCC for the license is owned by ZCC and your ZCHLF are shares in ZCC so any dividend, etc. paid should go to all shareholders which include you. There is your other benefit.