OrganiGram forces conversion of C$98.02 million 6% notes due 2020

By Susanna Moon

Chicago, Feb. 27 – OrganiGram Holdings Inc. said it will exercise its right to convert its C$98,024,000 of outstanding 6% convertible unsecured debentures due Jan. 31, 2020 on April 1.

Under the note terms, OrganiGram may force the conversion of the debentures at the conversion price of C$5.42 per common share when the volume-weighted average trading price of the shares exceeds C$7.05 on the TSX Venture Exchange for 10 consecutive trading days, which occurred as of Feb. 26, according to a company announcement.

The company’s stock (Vancouvr: OGI) closed at C$8.53 on Feb. 26.

The conversion is scheduled for April 1, when the debentures will be converted into 18,085,608 common shares plus accrued interest.

Holders of may convert their debentures under the note terms before the conversion date.

The company said the conversion will save about C$4.9 million in cash interest payments and “also eliminate a significant liability from the company’s balance sheet.”

OrganiGram Holdings is the Moncton, New Brunswick-based parent company of OrganiGram Inc., a licensed producer of medical marijuana.

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