Emisphere raises $15 million from term loan it may replace with convertible notes

By Sheri Kasprzak

New York, Sept. 26 - Emisphere Technologies, Inc. said it has raised $15 million from a senior secured loan and is seeking shareholder approval to replace the loan with a senior secured convertible note in the same amount.

MHR Fund Management LLC will finance the loan, the full terms of which could not be determined Monday afternoon.

Upon shareholder approval, the company will replace the loan facility with a $15 million convertible note, also funded by MHR under similar terms as the loan.

The note will be convertible into common shares at a premium to Emisphere's closing stock price of $3.77 on Friday.

Emisphere may call the note in 2010 under certain conditions.

Based in Tarrytown, N.Y., Emisphere develops oral drug-delivery systems for prescription drugs like insulin.

On Monday, Emisphere's stock gained $0.08 to close at $3.85.

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