BELLUS Health reports results for first half of f...(d average price at that time and replaci...),Health

Date:8/11/2009

d average price at that time, and replacing the right of the holder to have BELLUS Health redeem the Amended Notes in November 2011 with a right to have BELLUS Health first redeem the Amended Notes in January 2014 at the then face value of the notes. Amendments to the notes also include the removal of certain negative covenants. Amendment of this aggregate $13,500,000 principal amount of Original Notes triggered a gain on extinguishment of debt in the amount of $6,243,000 during the current quarter. Assuming that the Amended Notes are converted in full at an assumed market price of CDN$0.24 in 2012, when the price of such instruments gets adjusted based on the then market price of the Common Shares, and that all interest thereon is paid by way of issuance of Common Shares at an assumed market price of CDN$0.24, the maximum number of Common Shares issuable under Amended Notes, as amended, would be 75,199,219, representing a potential dilution factor of 144%, based on the number of Common Shares issued and outstanding as at June 30, 2009.

BELLUS Health has agreed that the right to redeem the Amended Notes shall be exercisable 90 days prior to the maturity date of the 2009 Notes issued to the Investors. Any additional unsecured debt, other than operating facilities or debt that is pari passu or junior in ranking to the Amended Notes, shall not mature or be redeemable for cash prior to the date on which the redemption right of the Amended Notes comes into effect. In addition, BELLUS Health has agreed to certain restrictions on its ability to declare or pay dividends in cash while the 2009 Notes are outstanding.

The terms of the 2009 Notes and of the Amended Notes require the continued listing of the Company's shares on the TSX; failure to meet this requirement may be an event default which may result in the convertible notes being immediately due and payable.

The landlord of the Company's premises, in Laval, Quebec, agreed, effective April 1, 200
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SOURCE BELLUS HEALTH INC. Copyright©2009 PR Newswire. All rights reserved

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