Zaio gets OK to lower conversion rate, extend 10% convertible maturity

By Toni Weeks

San Luis Obispo, Calif., April 2 - Holders of Zaio Corp.'s 10% secured redeemable convertible debentures dated June 15, 2011 approved amendments to the notes' terms at a meeting on April 1, according to a press release.

Holders representing over C$3 million of the debentures, or 44 of the 47 debentureholders that were present, voted to accept the amendments.

The company is now permitted to extend the maturity date of the debentures to June 15, 2015 from June 15, 2013 and decrease the conversion price to C$0.175 from C$0.20.

Other amendments modified the interest payment schedule to a semiannual basis from a quarterly basis to reduce administrative costs, pushing the next interest payment to June 30, and gave the company the ability to pay interest in shares unless the holder elects a cash payment.

Zaio said in a previous release that the proposed amendments would benefit both the company and debentureholders by ensuring financial resources are focused on developing the business, stabilizing the company's capital structure through the next 24 months, providing holders with a continuation of the returns they have been receiving and providing management with a more flexible capital structure to complete additional financings required to build out and expand the company's business products.

"Zaio now has multiple products selling on a daily basis [and] significant territory expansions underway, and the alignment of the company's senior creditors is now complete," president and chief executive officer David King said in the release. "Zaio is in a position to take advantage of the massive opportunity our patented technology affords us in the U.S. market," he said.

Zaio also needed approval of the TSX Venture Exchange to amend the debentures.

Calgary, Alta.-based Zaio provides customers in the property valuation, underwriting and lending industries with real-time access to certified appraisal reports from its database.

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