F-1/A: ZenaTech Files for Direct Listing on Nasdaq Capital Market

ZenaTech, an enterprise software technology company, is pursuing a direct listing on the Nasdaq Capital Market to facilitate the resale of up to 17,372,050 shares of its common stock.

Summary

• ZenaTech, Inc., an enterprise software technology company, has filed an amendment to its registration statement for a direct listing on the Nasdaq Capital Market under the ticker symbol ZENA.
• The filing relates to the registration of the resale of up to 17,372,050 shares of common stock by registered stockholders, including shares issuable upon exercise of outstanding warrants.
• Unlike an initial public offering, this resale is not being underwritten by any investment bank, and the registered stockholders may or may not elect to sell their shares.
• ZenaTech will not receive any proceeds from the sale of shares by the registered stockholders.
• The company expects its common stock to begin trading on or about September 17, 2024, but this is contingent on Nasdaq approval and may be terminated if the listing is not secured.
• A 1-for-6 reverse stock split was effected on July 1, 2024, and all share and per share data have been adjusted to reflect this split.
• On July 15, 2024, ZenaTech issued 291,829 units at $10.28 per unit, raising approximately $3,000,000 USD for general corporate and working capital purposes.
• The company is considered an emerging growth company and a foreign private issuer, allowing it to comply with certain reduced reporting requirements.
• Dr. Shaun Passley, the CEO, controls more than 50% of the company's voting stock, making it a controlled company under Nasdaq rules.

Sentiment

Score: 5

Explanation: The document presents a mixed sentiment. While the direct listing and recent capital raise are positive, the company's declining revenue and net losses, along with various risks and dependencies, temper the overall outlook.

Positives

• The direct listing provides an opportunity for existing stockholders to realize value from their shares.
• The recent unit offering raised $3,000,000 USD for general corporate and working capital purposes.
• The company's emerging growth company and foreign private issuer status allows for reduced reporting requirements, potentially decreasing compliance costs.
• The company has a management services agreement with Epazz to support the development of its products.

Negatives

• ZenaTech will not receive any proceeds from the resale of shares by registered stockholders.
• The listing is contingent on Nasdaq approval and may be terminated if the listing is not secured.
• The company is considered a controlled company, which may reduce certain corporate governance protections for stockholders.
• The company is dependent on its relationship with Epazz Inc.

Risks

• There is currently no public trading market for the company's common shares.
• The market price of the common shares may be volatile and subject to wide fluctuations.
• The company may need additional capital for its operations, and there is no assurance that it will be able to raise additional capital on acceptable terms.
• The company's business is subject to a variety of regulatory risks.
• The company's intellectual property rights may be infringed, or the company may infringe the intellectual property rights of others.
• The company is dependent on key personnel.
• The company may be subject to growth-related risks including pressure on its internal systems and controls.
• The company's business is dependent on its relationship with Epazz Inc.

Future Outlook

The company plans to expand its business into Unmanned Vehicle Systems (drones) and is developing software for various applications of the drone, including defense and military capabilities.

Industry Context

The company operates in the competitive enterprise software and drone industries, requiring continuous innovation and adaptation to changing technologies and market needs.

Comparison to Industry Standards

• The document does not provide enough information to make a detailed comparison to industry standards.
• However, the document does mention some competitors in the medical records software industry, including AdvanceMD, DrChrono EHR, NextGen and Kareo.
• The document also mentions some competitors in the safety and field management software industry, including Alcumus, gocanvas, EHSInsight, SimPRO and ServiceTitan.
• The document also mentions some competitors in the drone industry, including DJI, Draganfly and Drone Delivery Canada.

Legal Proceedings

• The Company was involved in a legal proceeding with The NOW Corporation, which was settled on June 24, 2022.
• The Company was involved in a legal proceeding with vendors of WorkAware Corporation, which was settled on July 8, 2024.

Related Party Transactions

• The company has a management services agreement with Epazz, Inc.
• The company licenses certain patents from Epazz.
• The company has convertible lines of credit with GG Mars Capital, Inc. and Star Financial Corporation, which are related parties.
• The company sold ZenaPay, Inc. wallet software to Epazz Limited, Ireland, a related party.

Stakeholder Impact

• Shareholders may experience volatility in the market price of the common shares.
• Employees may be affected by the company's ability to manage growth and attract and retain qualified personnel.
• Customers may benefit from the company's continued development of new products and services.
• Suppliers may be affected by the company's ability to obtain components and raw materials on a timely basis and at acceptable prices.
• Creditors may be affected by the company's ability to generate profitable operations and obtain additional financing.

Next Steps

• Secure Nasdaq approval for the direct listing.
• Convert pilot customers into paying customers for the drone technology.
• Continue developing and testing drone technology for various applications.
• Expand the drone business into new markets, including the United States, Canada, Germany, and Dubai.

Key Dates

Keywords

direct listing, Nasdaq, ZenaTech, common stock, resale, emerging growth company, foreign private issuer, reverse stock split, warrants, financial advisor