By Sheri Kasprzak
Atlanta, Nov. 10 - Generex Biotechnology Corp. has received definitive agreements from investors to purchase $4 million of the company's 6% secured convertible debentures.
The debentures, offered to four accredited investors in a private placement, have a term of 15 months. The debentures bear interest at 6% and are convertible into common shares any time after closing at $0.82.
The warrants in the deal are initially exercisable into the same number of shares issuable upon conversion. The initial exercise price of each warrant is 110% of the conversion price, or $0.91.
In the transaction, Generex also granted additional investment rights to each investor. Each investor has the right, at any time after the 181st day following the closing date of the deal, to buy the same number of debentures and warrants under the same terms. The additional debentures may also be bought on or before the earlier of the close of business on the one-year anniversary of the registration statement for the underlying debentures or the two-year anniversary of the closing of the private placement.
Toronto-based Generex is a drug research and development company. It plans to use the proceeds from the financing to accelerate clinical development activities and for working capital and general corporate purposes.
| Issuer: | Generex Biotechnology Corp.
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| Issue: | Secured convertible debentures
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| Amount: | $4 million
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| Maturity: | 15 months
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| Coupon: | 6%
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| Price: | Par
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| Yield: | 6%
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| Conversion price: | $0.82
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| Warrants: | Determined by the number of shares issuable upon conversion
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| Warrant strike price: | Initial price $0.91
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| Announcement date: | Nov. 10
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| Stock price: | $0.72 at close Nov. 10
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