Conversion price reflects 57.39% discount to last closing share price
By Susanna Moon
Chicago, April 24 - BioZone Pharmaceuticals, Inc. said it sold a 10% senior secured convertible promissory note to an investor for $250,000.
The company said it may prepay any outstanding amounts under the note, in whole or in part, at any time prior to maturity.
The remaining principal amount and all accrued interest is due on the earliest of (1) the final maturity date, (2) the completion of a financing resulting in net proceeds of at least 1.5 times the remaining outstanding unconverted principal amount and (3) the occurrence of an event of default.
The note is convertible into the company's common shares at an initial conversion price of $1.50 per share, which is a 57.39% discount to the March 14 closing share price of $3.52.
The company said it is prohibited from effecting a conversion of the note if the investor would beneficially own more than 4.99% of the total issued and outstanding shares as a result of the conversion.
All of the company's obligations under the note are secured by a first-priority security interest in the vendor proceeds.
Certain holders of the company's senior secured debt agreed to subordinate their security interest in the vendor proceeds to the interest of the investor under the note, according to a company press release.
Biozone is a Henderson, Nev., biopharmaceutical company.
| Issuer: | Biozone Pharmaceuticals, Inc.
|
| Issue: | Senior secured convertible promissory note
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| Amount: | $250,000
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| Coupon: | 10%
|
| Conversion price: | $1.50
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| Settlement date: | April 18
|
| Stock symbol: | OTCBB: BZNE
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| Stock price: | $3.52 at close March 14 (last close)
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| Market capitalization: | $198.81 million
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