SCHOFIELD, Wis., June 1, 2010 (GLOBE NEWSWIRE) -- PuraMed BioScience (OTCBB:PMBS), a pharmaceutical company engaged in the development and marketing of a line of revolutionary, new, non-prescription medicines that treat migraine headaches, insomnia and tension-type headaches under the brand name LipiGesic™, announced today that it has signed a $5 million purchase agreement with Lincoln Park Capital Fund, LLC (LPC), a Chicago-based institutional investor.
Upon signing the agreement, PuraMed received $100,000 from LPC as an initial purchase under the $5 million dollar commitment in exchange for 200,000 shares of common stock and warrants to purchase 100,000 shares of common stock at an exercise price of $1.25 per share and warrants to purchase 100,000 shares of common stock at $1.75. Neither the common stock nor the shares underlying the warrants will be registered.
The Company also has the right at its discretion to sell to LPC up to an additional $4.9 million of its common stock over a 30-month period provided that a registration statement related to the transaction has been declared effective by the U.S. Securities & Exchange Commission (SEC). Generally, the Company has the right to sell stock to LPC in amounts between $25,000 and $500,000 depending on certain conditions as set forth in the purchase agreement.
There are no upper limits to the price LPC may pay to purchase PuraMed's common stock and the purchase price of the shares related to the $4.9 million of future funding will be based on the prevailing market prices of the Company's shares at the time of sales without any fixed discount, and the Company will control the timing and amount of any sales of shares to LPC. LPC shall not have the right or the obligation to purchase any shares of the Company's common stock on any business day that the price of the common stock is below $0.25.
"We are pleased to have signed a purchase agreement with Lincoln Park Capital," said PuraMed BioScience CEO Russell Mitchell. "After significant due diligence, we look forward to this opportunity to work with the management team of Lincoln Park Capital who we have known for a long time. They have an outstanding reputation in the financial marketplace. LPC has a broad understanding of the capital markets, and the ability to structure creative, simple and effective investments."
Mitchell continued, "This agreement allows us the flexibility to make strategic decisions that should benefit PuraMed shareholder value. We plan to use these proceeds from this purchase agreement to continue to build upon our current business strategy to promote our LipiGesic™ M (migraine) product via our direct response marketing campaigns to as many consumers in the U.S. market as possible. We also anticipate that once a significant level of branding has been achieved, we will commence our commercial retail introduction by third quarter of calendar year 2010."
A more detailed description of the agreement is set forth in the Company's current report on Form 8-K recently filed with the SEC which the Company encourages be reviewed carefully.
About Lincoln Park Capital ("LPC"):
Lincoln Park Capital is an institutional investor headquartered in Chicago, Ill. LPC's experienced professionals manage a portfolio of investments in public and private entities. These investments are in a wide range of companies and industries emphasizing life sciences, energy and technology. LPC's investments range from multiyear financial commitments to fund growth to special situation financings to long-term strategic capital offering companies certainty, flexibility and consistency. For more information, visit www.LincolnParkCapital.com.
About the PuraMed BioScience, Inc.:
PuraMed BioScience, Inc. engages in the research, development and marketing of non-prescription medicinal and healthcare products. In addition to its leading product LipiGesic™ M, which provides acute relief from migraine headaches; the Company also has plans to launch LipiGesic™ PM that provides a remedy for insomnia and other sleep disorders as well as LipiGesic™ H for common tension headaches. For more information on PuraMed, visit the Company website at www.PuraMedBioScience.com, join the Company's group page on Facebook by searching "PuraMed BioScience" and follow the Company on Twitter at www.twitter.com/puramed.
Forward Looking Statements:
This news release contains forward-looking statements regarding PuraMed BioScience and its future business plans, which statements involve known and unknown risks and uncertainties. Such risks and uncertainties may cause actual results and future achievements of PuraMed BioScience to be materially different than those implied by these forward-looking statements. PuraMed BioScience has and undertakes no obligation to provide public updates and revisions to these forward-looking statements to reflect any changes in its expectations of future events.