BOULDER, Colo., Jan. 30 /PRNewswire/ -- Performance Health Technologies, Inc. ("Performance Health"), a leader in the development and marketing of innovative products that guide and monitor exercise, announced today that it has entered into a Standby Equity Distribution Agreement (the "SEDA") with Cornell Capital Partners, LP ("Cornell Capital"), pursuant to which Performance Health may, at its discretion, periodically sell to Cornell Capital shares of Performance Health common stock for a total purchase price of up to $10.0 million. For each share of common stock purchased under the SEDA, Cornell Capital will pay Performance Health 95% of the lowest volume weighted average price of Performance Health common stock as quoted by Bloomberg, LP on the Over-the-Counter Bulletin Board or other principal market on which Performance Health common stock is traded for the five days immediately following the date Performance Health delivers a notice requiring Cornell Capital to purchase Performance Health shares under the SEDA. The advance is limited to $500,000 every five trading days.
Cornell Capital's obligation to purchase shares of Performance Health common stock under the SEDA is subject to certain conditions, including Performance Health (i) becoming a reporting company under the Securities Exchange Act of 1934, as amended (a "Reporting Company"), and (ii) obtaining an effective registration statement under the Securities Act of 1933, as amended, for the shares of common stock to be sold under the SEDA (the "Registration Statement"). Performance Health intends to file the Registration Statement in February 2006, which depends on the completion of audited financial statements for fiscal years 2004 and 2005, as well as certain other factors.
As of the date of this Press Release, Performance Health is not a Reporting Company and has not filed the Registration Statement and therefore cannot access the funds under the SEDA.
While Performance Health intends to become a Reporting Company and obtain an effective Registration Statement in order to access the funds available under the SEDA, no assurance can be given that Performance Health will either become a Reporting Company or obtain an effective Registration Statement at any time. In the event Performance Health does not become a Reporting Company or obtain an effective Registration Statement, Performance Health will not be able to sell any shares to Cornell Capital under the SEDA.
Performance Health intends to use proceeds received under the SEDA to expand its marketing efforts and develop its distribution facilities. Marc Silverman, Performance Health's President and CEO said, "We are delighted to work with Cornell Capital. We believe this financing, combined with our Reporting Company status, will provide the capital to reach our target markets, and will provide a measure of liquidity to our investors."
The commitment period under the SEDA begins on the earlier to occur of (i) the date that the Registration Statement is declared effective by the Securities and Exchange Commission (the "Effective Date"), or (ii) such earlier date as Performance Health and Cornell Capital may mutually agree in writing.
The commitment period under the SEDA expires on the earliest to occur of (i) the date on which Cornell Capital has purchased an aggregate amount of $10,000,000 shares of Performance Health common stock under the SEDA, (ii) the date occurring twenty-four months after the Effective Date, or (iii) the date the Agreement is earlier terminated pursuant to the SEDA.
Performance Health has agreed to pay Cornell Capital 5% of the proceeds that Performance Health receives under the SEDA. In addition, upon execution of the SEDA, Performance Health paid Cornell Capital a commitment fee of 2,000,000 shares of Performance Health common stock. Performance Health also paid Yorkville Advisors, LLC a fee of $10,000 for structuring and legal expenses and $2,500 for due diligence expenses and paid Newbridge Securities Corporation a fee of 40,000 shares of Performance Health common stock under a placement agent agreement relating to the SEDA.
About Performance Health Technologies, Inc.:
Performance Health develops and markets products that help consumers feel better and more physically fit. Additional information can be obtained by calling the company headquarters in Boulder, Colorado, 303-527-0600; and through the company website www.performancehealth.com.
About Cornell Capital:
Based in Jersey City, NJ, Cornell Capital Partners, LP began operations in January 2001 to address the financing needs of publicly traded companies. Since then, Cornell Capital has successfully financed numerous public companies.
Safe Harbor for Forward-Looking Statements:
The foregoing contains "forward-looking statements," which are based on management's beliefs, as well as on a number of assumptions concerning future events and information currently available to management. Readers are cautioned not to put undue reliance on such forward-looking statements, which are not a guarantee of performance and are subject to a number of uncertainties and other factors, many of which are outside Performance Health's control that could cause actual results to differ materially from such statements. Performance Health disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Performance Health Technologies, Inc.CONTACT: Performance Health Technologies, Inc., +1-303-527-0600
Web site: http://www.performancehealth.com/
