Yangaroo to seek holder approval to amend terms of convertibles

By Angela McDaniels

Tacoma, Wash., June 16 - Yangaroo Inc. will seek holder approval to amend two series of convertible debentures to reflect the terms of new 18% senior secured debentures it plans to issue, according to a company news release.

The company has C$818,000 principal amount of 12% convertible debentures due March 31, 2012 and C$1,127,000 principal amount of convertible debentures due July 31, 2012.

The new and amended debentures would be non-convertible and putable after five years. They would become callable if the company raises at least C$4 million of "net new cash," which would include the proceeds raised from the issuance of the new debentures but would exclude the proceeds from the repayment of any debentures that are used to fund the purchase of new securities of the company.

In the event of an asset sale in excess of C$3 million, the company would be required to offer to repurchase at least 50% of its outstanding debentures at par plus accrued interest.

Debenture holders would also have a right of first refusal to participate in future offerings by the company, subject to the satisfaction of certain conditions.

The company plans to issue up to C$2.56 million principal amount of the new debentures.

In accordance with the rules of the TSX Venture Exchange, the company plans to issue up to 13,636,666 "bonus" common shares to purchasers of the new debentures and holders of the amended debentures.

Fraser Mackenzie Ltd. is acting as the agent for this transaction.

Yangaroo is a Toronto-based secure digital media distribution company.

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