NuPathe (PATH) to Cut Workforce 50%, Delay IND for NP202, Cut NP101 Spending

NuPathe Announces $28 Million Private Placement

CONSHOHOCKEN, PA -- (Marketwire) -- 09/25/12 -- NuPathe Inc. (NASDAQ: PATH), a specialty pharmaceutical company focused on the development and commercialization of branded therapeutics for diseases of the central nervous system, today announced that the Company has entered into agreements with existing and new investors for the sale of $28 million of securities. The securities are being sold as units, with each unit consisting of 1/1,000th of a share of to-be designated Series A preferred stock and a warrant to purchase one share of the Company's common stock. The purchase price per unit is $2.00.

Each 1/1,000th of a share of Series A preferred stock will initially be convertible into one share of common stock, accrue quarterly dividends at an initial rate per annum of 8%, have a liquidation preference of $2.00 (plus accrued and unpaid dividends), and have certain other powers, preferences and rights. The holders of the Series A preferred stock shall initially be entitled to elect three directors to the Company's board of directors and certain corporate actions will require the approval of a majority of the outstanding shares of Series A preferred stock. The warrants will initially be exercisable at $2.00 per share and will expire five years from the date of issuance. Both the Series A preferred stock and warrants include "full ratchet" antidilution protection. The Series A preferred stock will automatically convert into common stock and the antidilution feature of the warrants will terminate upon certain specified conditions including the second to occur of FDA approval of the Company's migraine patch (also known as NP101) and an equity financing or other transaction that results in aggregate gross proceeds to the Company of at least $22 million.

In conjunction with this private placement, NuPathe... More