Orbus ups coupon on C$5.3 million convertibles to 10%, extends maturity

By Susanna Moon

Chicago, Sept. 5 - Orbus Pharma Inc. said it entered into an arrangement to amend its C$5.3 million convertible debentures due Dec. 23, 2008.

The supplemental indenture includes the following provisions:

• Extends term of notes for three more years from the effective date of Aug. 15;

• Raises coupon to 10% from 8%, with the right of the company to suspend interest payments for the first year;

• Lowers conversion price to C$0.40 per share from C$0.60 per share; and

• Allows forced conversion by the corporation at C$1.00 per share in the second year and C$1.25 per share in the third year.

Orbus also issued one common share purchase warrant for every two common shares issuable on conversion of the debentures for a total of 6,625,000 warrants.

Each warrant is exercisable at C$0.40 per share until Aug. 15, 2011.

The company also said it completed an additional offering of C$2 million principal amount of debentures with the same terms as the amended debentures. The offering includes one warrant for every two shares for a total of 2.5 million warrants. Each warrant is exercisable at C$0.40 until Aug. 15, 2011.

Orbus is a pharmaceutical company based in Markham, Ont.

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