ZeU has entered into amending agreements with debenture holders to amend the terms of
These Original Debentures have a floor conversion price of
Today’s announcement covers all but one of the Canadian debenture holders. Based on the on-going discussions with the last remaining Canadian entity, Management expects to have the agreement formalized within the coming days. Management is also in communication with the Chinese debenture holders. As of today,none of these investors have entered into the new agreement, and
New Debentures Terms
Under the terms of the amended debentures (the “Amended Debentures“), the maturity date has been extended two years from
(i)the floor conversion price of the principal amount of the Debentures has been reduced from
$1.00to $0.25per common share;
(ii)the interest has beenraised from 10% to 12%;
(iii)the Amended Debentures now rank inpriority of all unsecured debts; and
(iv)the Company issued2 years,
$0.30common share purchase warrantsof ZeU for every tranche of $0.25of Original Debenture principal amount amended. The proceeds of the warrants will be used to buy back the debentures if it has not been repaid or converted at the time of the warrants exercise.
The Company is also agreed to assign 30% of all net private placement proceeds, minus the insiders’ subscriptions, and 60% of its future profits to repay the debentures in priority until the debt is settled in full.
The amendments are subject to approval by the CSE.