Pharmos
Sells $4.3 Million in Common Stock; Redeems Balance of
Convertible Debentures
Iselin,
NJ, March 4, 2003 - Pharmos Corporation (Nasdaq: PARS
and Nasdaq Europe: PHRM) announced today that it has raised
$4.3 million gross proceeds in an issuance of common stock
and warrants with a group of institutional investors.
The proceeds will be used for general corporate purposes.
Rodman & Renshaw, Inc. acted as placement agent on
a portion of the transaction.
The
Company also announced that it has redeemed the balance
of its 6% Convertible Debentures due June 2003. The $3.5
million original issue amount of the notes was redeemed
for approximately $3.8 million including accrued and unpaid
interest.
"Our
existing cash is needed to support our clinical programs,
particularly our ongoing Phase III study of dexanabinol
for severe traumatic brain injury, which study is preparing
to expand into the US," commented Robert W. Cook,
Executive Vice President and Chief Financial Officer.
"We did not want to divert our cash to repay the
convertible debentures, and in light of the uncertainty
in the marketplace we felt this new financing was a necessary
step towards insuring we met that goal."
An
aggregate of approximately 5.1 million shares were issued
utilizing a shelf registration declared effective by the
Securities and Exchange Commission in February 2003, and
the offering was priced at $.85 per share. The aggregate
number of warrants issued was equivalent to 20% of the
total number of shares of common stock issued, with an
exercise price of $1.25 per share and an expiration date
of March 2007. Investors in the offering do not have any
repricing or other adjustment rights for their common
stock, and their warrants do include anti-dilution adjustment
rights if Pharmos were to issue stock below the $1.25
warrant exercise price.
About
Pharmos
Pharmos discovers, develops, and commercializes novel
therapeutics to treat a range of indications, in particular
neurological and inflammation-based disorders. The Company's
first neuroprotective product is dexanabinol, a synthetic
tricyclic non-psychotropic dextrocannabinoid, currently
undergoing clinical testing as a treatment for TBI and
as a preventive agent against post-surgical cognitive
impairment. Other dextrocannabinoid compounds and CB2
receptor agonist compounds from Pharmos' proprietary synthetic
cannabinoid library are being studied in pre-clinical
programs targeting stroke, pain, multiple sclerosis and
other disorders.
Statements
made in this press release related to the business outlook
and future financial performance of the Company, to the
prospective market penetration of its drug products, to
the development and commercialization of the Company's
pipeline products and to the Company's expectations in
connection with any future event, condition, performance
or other matter, are forward-looking and are made pursuant
to the safe harbor provisions of the Securities Litigation
Reform Act of 1995. Such statements involve risks and
uncertainties which may cause results to differ materially
from those set forth in these statements. Additional economic,
competitive, governmental, technological, marketing and
other factors identified in Pharmos' filings with the
Securities and Exchange Commission could affect such results.
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