RepeatSeat granted forbearance with holders of secured convertibles

By Devika Patel

Knoxville, Tenn., April 22 - RepeatSeat Ltd. said it has reached a forbearance agreement with the holders of its C$7 million of secured convertible debentures that were issued on June 18, 2007.

On April 16, the company agreed to appoint a receiver to sell the assets of its operating subsidiary, Janda Products Canada Ltd.

The debentures were issued to fund Janda's acquisition. The company owes the lenders C$8.7 million, which includes unpaid interest and fees.

RepeatSeat has acknowledged a default under the debentures and the investors are demanding that the company pay its debt. The lenders agreed under the forbearance to a repayment schedule and to convert their remaining interest into equity.

Janda's assets will be sold and the proceeds will be used to pay the lenders. This sale is expected to be consummated by May 31. The investors agreed to offer the received C$4.5 million for these assets.

RepeatSeat also will pay the investors C$690,000 by Sept. 30, which it will raise by issuing new equity.

Any additional amounts owed to the investors will be converted into equity. The total amount of equity expected to be paid will be limited to 19.99% of the fully diluted number of shares on the conversion date. It is anticipated that each individual lender will own less than 10% of the fully diluted number of shares after this conversion.

The conversion is contingent upon RepeatSeat completing an internal restructuring to reduce operating expenses and a conversion of certain unsecured debt obligations into equity.

Based in Calgary, Alta., RepeatSeat provides ticketing and other services to entertainment venues.

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