Home Up Site Map Search 
ZTEST Logo
December 18, 2003

ZTEST ANNOUNCES DEBT RESTRUCTURING AND GRANT OF STOCK OPTIONS

NORTH YORK, December 19, 2003 - ZTEST Electronics Inc. ("ZTEST" or the "Corporation") (TSXVE - "YZT") wishes to announce that it has completed a restructuring of $1,167,375 in outstanding convertible debenture bearing interest at between 8% and 10.5%, coming due between December 3, 2003 and October 25, 2004 and convertible into units of ZTEST at prices of between $0.10 and $0.16 per unit with each unit consisting of a common share and a warrant exercisable at prices between $0.10 and $0.18 per share by issuing new debentures totalling$1,243,593.63 and bearing no interest (the "New Debentures").

There are three types of new debentures as follows: (i) $942,763.63 in convertible debentures bearing no interest for a period of three (3) years and convertible into units at the rate of one (1) unit for each $0.10 of debt converted if converted in the first two years and for each $0.11 of debt converted if converted in the third year. Each unit consists of a common share and a warrant with each warrant entitling the holder to acquire a common share at a price of $0.10 per share if the debenture is converted in the first two years and $0.11 per share if the debenture is converted in the third year. The warrants expire on the earlier of two (2) years from conversion and the due date of the debenture (the "3 Year Unit Debentures"); (ii) $222,292.50 in convertible debentures bearing no interest for a period of two (2) years and convertible into units at the rate of one (1) unit for each $0.10 of debt converted. Each unit consists of a common share and a warrant with each warrant entitling the holder to acquire a common share at a price of $0.10 per share. The warrants expire on the due date of the debenture (the "2 Year Unit Debentures"); and (iii) $78,537.50 in convertible debentures bearing no interest for a period of two (2) years and convertible into common shares at the rate of one (1) common share for each $0.10 of debt converted (the "2 Year Share Debentures). In order for subscribers to subscribe for either the 3 Year Unit Debenture or the 2 Year Unit Debenture, they were required to increase the principal amount of their exiting debentures by 7% by way of an additional cash investment. These funds will be used for working capital.

Insiders subscribed for a total of $83,326.25 in 3 Year Unit Debentures and $5,937.50 in 2 Year Share Debentures.

In addition, the board of directors of ZTEST granted 950,000 director and senior officer options exercisable at $0.12 per share for a period of 5 years to the following persons: Wojciech Drzazga - 275,000 options, John Perreault - 275,000 options, William Brown - 100,000 options, Mike Guerreiro - 100,000 options, Don Nurse - 100,000 options, Mike Kindy - 50,000 options and William R. Johnstone - 50,000 options. ZTEST also granted a further 150,000 options on the same terms to various employees and consultants.

For more information contact: 

Ted Drzazga, CEO 
(416) 297-5155 
email: info@ztest.com 

TSX Venture Exchange has neither approved nor disapproved of the contents of this press release. 

- 30 -