Compliance Systems to redeem convertible debentures sold to YA Global, Montgomery Equity

By Devika Patel

Knoxville, Tenn., Dec. 12 - Compliance Systems Corp. received approval from investors YA Global Investments, LLC and Montgomery Equity Partners, LP to raise additional capital, according to an 8-K filed Wednesday with the Securities and Exchange Commission.

The investors will consent to the additional financing if Compliance redeems all of the convertible debentures held by the two companies.

In the 8-K, the company said it believes it can repay all of the debt by Dec. 31.

Compliance Systems also said in the filing that it has entered into an agreement with The Investor Relations Group Inc., which will serve as Compliance's investor relations and corporate communications firm in exchange for a $5,000 monthly maintenance fee and a one-time fee of 5 million restricted common shares.

Based in Grand Rapids, Mich., Compliance Systems provides technologies to financial institutions to help them file required compliance forms with the federal government.

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