GENERAL: DIL: Prepayment Transaction Complete

9 Jun 2010 8:43 am

DIL 09/06/2010 GENERAL

REL: 0842 HRS Diligent Board Member Services INC (NS)

GENERAL: DIL: Prepayment Transaction Complete

Diligent and Services Share Holding Complete Prepayment Transaction

At a Closing held in New York on June 8, 2010, the transaction, approved by the shareholders of Diligent Board Member Services ("DIL") at its Annual Meeting on June 8, 2010 (NZ time) involving prepayments against the US$6.8 million Note from Services Share Holding ("Services") to DIL, was completed.

The transaction involved two prepayments, one being a cash payment of US$1,010,430 and the second being the surrender to DIL by Services of 11,650,000 shares of Diligent common stock pledged by Services as security for the Note in exchange for a credit against the Note of US$3,075,676. The surrendered shares are being retired by DIL. There remains an outstanding balance on the Note of US$3,081,685, which is secured by 5,205,597 shares of DIL common stock pledged by Services.

In addition, and as part of the transaction, the Note was amended to increase the interest rate from 5% to 6.5%, the maturity date of the Note was extended from October 1, 2010 to October 1, 2012, Services' right to a return of shares of pledged stock if the value of pledged stock exceeded the outstanding balance on the Note by 150% was eliminated and interest payments on the Note were converted to payment on an annual basis in lieu of quarterly payments.

The retirement of the surrendered shares reduces the number of outstanding shares of DIL common stock from 90,440,000 to 78,790,000. There are also 32,667,123 shares of Series A Convertible Preferred Stock outstanding. End CA:00195876 For:DIL Type:GENERAL Time:2010-06-09:08:43:02

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