StockMarketWire.com - Online games entertainment group Zattikka has confirmed that talks with loan note holders are continuing.

In its trading update released on 9 July, the company advised that certain loan note interest, in an amount of £0.275m, was at that time due to be paid.

The company has not yet made the payment and, as a result, has received a demand from the Hattrick loan note holders for payment by close of business on 2 August.

Zattikka says it has been told that if the payment is not made by the expiry date, the principal amount under the Hattrick loan notes (an amount of €6.4m) would become repayable in full within two business days.

Zattikka says its directors have received advice that the company should not make the interest payment at this time, as this may, should the company enter into administration, constitute a preference under the Insolvency Act 1986.

It says that as it announced on 9 July, the group has entered into negotiations with its loan note holders with a view to extinguishing a substantial proportion of the group's liabilities. These negotiations have not yet resulted in a consensus outcome but they continue, and the company will update the market on the result of these in due course.

At 2:57pm: [LON:ZATT] share price was -1.5p at 5.5p


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