Developing the Albany Graphite Deposit

Hydrothermal Graphite Deposit with the Potential to Produce Natural, High-Purity Graphite

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Message: AGORACOM ZEN Online Shareholder Q&A Response

Dear Shareholders,

ZEN Graphene Solutions is proud to provide the following response to its Online Q&A:

AGORACOM

 

From: golf20

 Questions:

Aside from some money left over to spend on flow through projects. Will we be requiring another financing shortly?

At this time, there is no financing contemplated by the company. 

Do we know where the selling pressure is coming from?

Unfortunately, there is no way to know with certainty, where the selling pressure is coming from.  We are focused on developing the company and anticipate that the value we hope to create will potentially over come the selling pressure.

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Jasonsensation

 

1)      when can we anticipate Environmental Assessment to be initiated? Q2?Q3?

 

We anticipate the EA to begin during Q2.

 

2)      With all the Recent networking in the graphene community, and given recent departure of Donald Bubar, has the BOD given any thought or considered strategically inviting new members to the ZEN BOD team?

The BOD and management are constantly evaluating the talent and skill set necessary to move the company forward based on current objectives.  If a need or requirement is identified, we will recruit accordingly.

 

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Steakhouse

1.      In the recent April 11th ZEN NR did the researchers compare ZEN Graphene to any other graphene's to come up with the resulting 324% increase in the anode discharge capacity?  If so how many other graphene's did they test?

The researchers did not compare any other graphene in these tests.  The 324% increase was the result of comparing the recycled, treated carbon from the tires (115 mAh/g) to the same material with 5% ZEN rGO (488 mAh/g).

2. When you have processed the bulk sample down to graphene you will have approximately 3.75 million grams, what criteria will you use to sell or give material away?  And when you sell material will you use market pricing or negotiated pricing?

We have not determined the amount of graphene we will have from the current bulk sample.  Once this is established, we will announce it.  Our criteria to sell or give away material is based on volume and average price.  We have listed our 5 verticals and all of them are potential markets for our graphene.  The pricing will be a negotiated price between us as the seller and the end user.

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From: Widdicombe

The scaling down of the bulk sample size from 990 tonnes to 110 tonnes will result in a corresponding reduction in high quality graphene output currently estimated at about 3.8 tonnes and projected to be available this fall.

Q1.-If sales are good and this inventory is depleted fairly rapidly how fast and at what rate can supply be replenished?

Q2. - What would be the approximate time frame to get supply rolling again?

The process to replenish our supply of graphene will be based on sales demand as well as an additional drill program next winter as we cannot access the property during the rest of the year with the required equipment for a bulk sample.  We anticipate easier property access for an additional drill program as  we already have our permits, the road has been  built and the required logistics (ie insurance, bridge crossings etc) are established. In addition, the processing of the ore first into 99.8% graphite and then  to graphene at the tonnage level may be potentially figured out this year making it easier the next time around.  While we potentially  expect a faster processing schedule on any future bulk sample, an exact time frame is currently difficult to assess.

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From: Pop12345

Is ZEN going to the Washington event?

If you are referring to the NGA, yes, ZEN will be attending.

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From: pymmer

1.      Is Zen currently working with Constance Lake on a resource sharing agreement?  If revenue is made on the sale of the recently removed material, is there an expectation to share that revenue, or is it understood that revenue would be used to establish the mine?

 

Those discussions will be happening soon and until they happen, we cannot answer this.

 

2.      Will the board and management present an updated work plan for shareholders within the next 2-3 months that outlines specific timelines for mine development items (EA, roads, other permitting requirements)?

 

We will announce these developments as they happen. 

 

3.      An updated PEA had been mentioned by management.  Is there an update for the expected release of this timeline?

We are working on the updated PEA model and are looking at the cost of graphene production as well as the selling price of graphene at industrial level with 3rd party support.  The updated PEA is a priority for the company as we believe it will highlight the value of the company.  We will announce a timeline when appropriate.

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From: Garth

1.      Graphene Market: What is the company’s current view of how the graphene market will develop in terms of price per gram/kilogram as well as the types of margins and market size the industry can expect once the market matures. Any additional coloring as those topics relate to Zen would be very welcome (if possible).

The Graphene market is maturing and we are now starting to see pricing at the industrial scale.  Cannacord Genuity out of the UK and the Graphene Council each put out pricing guidelines that were very similar in the last few weeks.  According to these reports, pricing guidelines for graphene varied from $100 to $1000 per kg however our pricing will be determined by negotiations between ZEN and end users.

Bulk Sample: Has there been any interest from our partners about buying the graphene once it's been processed? Does management have confidence that our product will have enough demand that we can sell through our inventory and use the data towards our banking/finance analysis?

We will announce sales of graphene when they happen.  Work indicates that we have a high quality, consistent product and we anticipate that there will be demand for our product.  Any sales data points from our bulk sample will potentially be beneficial for the PEA pricing module.

2.      Intellectual Property: Are any of the research agreement's we've been engage with close to generating patentable results? Is there a line of sight where we can expect revenue from licensing activities?

We continue to work with multiple researchers to functionalize graphene into end products.  This work may potentially lead to Intellectual Property which depending on the relationship with the research group can be 100% ZEN’s IP or a shared IP depending on the structure of the research agreement.  The Company plans to report on any new IP once it has been properly secured. 

From: lowsignal

1)      In order for the newly revised PEA to be valuable, will we need to have more precise graphene price estimates or can it be done with the precision we're already at? after all, a wide price range means just about nothing to anyone, neither suppliers nor buyers.

We will need more precise pricing and this is part of the current work being done for the updated PEA.  We are starting to receive more precise info on graphene pricing as discussed earlier and this will help with the PEA pricing module.

2)      If more precise price estimates for graphene are needed, how long will it delay the new PEA?

We will report on this as soon as know.

3)      Do you have a better idea these days, how easily we could mine Albany with self-funding (completion of the bulk sample)? a promise of a standard dividend without further dilution would shoot the stock to quite high prices. it makes the share price value easy to calculate in most situations.

The BOD is constantly evaluating the optimal capital strategy for the company, including raising new capital for moving the company forward and when appropriate, the return of capital to shareholders in the form of a share buy back program or dividends.  However, as a pre-revenue company, no strategy has been developed for the future potential return of capital at this time.

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