Unilife Completes A$23.1 Million Private Placement

LEWISBERRY, Pa., Dec. 3, 2010 /PRNewswire-FirstCall/ -- Unilife Corporation (Unilife or Company) (Nasdaq: UNIS; ASX: UNS) announced today that it has completed the A$23.1 million private placement (Placement), which was previously announced on 29 November 2010.

Unilife issued 27,228,143 CHESS Depositary Interests (CDIs) (Placement CDIs) at an issue price of A$0.85 (each CDI representing an interest in one sixth of a share of the Company's common stock) with free attaching unlisted options (Placement Options) to sophisticated and professional investors in Australia. The principal terms of the Placement CDIs and Placement Options are as set out in our announcement on 29 November 2010.

Unilife intends to use the net proceeds from the Placement and SPP for the purchase of additional capital equipment, for general operations including the development of other pipeline products and supporting the 2011 transition of Unilife into a commercial manufacturer and supplier of its proprietary medical devices to pharmaceutical and healthcare companies.

As the issue of the Placement CDIs was within the Company's 15% issue capacity under ASX Listing Rule 7.1, approval for the issue of the Placement CDIs (and Placement Options) is not being sought from the Company's shareholders.

Restrictions on resale of shares and CDIs into the U.S.

The Placement was, and the forthcoming Share Purchase Plan (SPP) will be, made available to investors in reliance on the exemption from registration contained in Regulation S of the United States Securities Act of 1933 (US Securities Act) for offers of securities which are made outside the U.S. This means that a registration statement (similar to an Australian prospectus) is not required to be prepared with respect to the Placement or the SPP.

However, in order to comply with the requirements of Regulation S, investors may not re-sell any Placement CDIs, Placement Options (or underlying securities) or SPP CDIs into the U.S. or to a U.S. person for a period of six months after the date of issue of the securities unless the re-sale of the securities is registered under the U.S. Securities Act or an exemption is available.

Accordingly, in order to enforce the above transfer restrictions whilst ensuring that shareholders can still trade their CDIs on ASX, the Company has requested that all of its CDIs bear a "FOR US" designation on ASX with effect from 3 December 2010.  

As a result of the imposition of the "FOR US" designation, all shareholders of the Company will be restricted from selling their CDIs on ASX to U.S. persons.  The FOR US designation will remain in place until six months after the date of allotment of CDIs under the Company's SPP which is expected to occur on or around 31 December 2010.  During this period, existing shareholders will still be able to elect to convert existing CDIs acquired prior to 3 December 2010 into shares of common stock and trade on NASDAQ.  However, if investors acquire CDIs under the Placement or SPP, or acquire CDIs on market after 3 December 2010 and elect to convert any such CDIs into common stock, they will receive restricted securities which would not be tradable on NASDAQ for this six month period.

Issue of warrants to consultants

The Company also has issued warrants to the parties set out below in connection with the successful development on-schedule of Unilife's new headquarters and manufacturing facility in York, Pennsylvania:

• 375,000 unlisted warrants to Keystone Redevelopment Group, LLC (Keystone). Keystone was appointed to manage the development of the York facility, and has worked with Unilife to obtain favorable public and private financing, and is assisting to secure necessary approvals, licenses, permits and certificates from government authorities. Each warrant will have an exercise price equal to the closing price of the Company's shares of common stock on NASDAQ on 2 December 2010 and will entitle Keystone to receive one share of common stock on exercise of the warrant; and;
• 225,000 unlisted warrants to L2 Architecture (L2), which was engaged by Unilife to custom-design the facility to comply with pharmaceutical standards and good manufacturing practices. Each warrant will have an exercise price equal to the closing price of the Company's shares of common stock on NASDAQ on 2 December 2010 and will entitle L2 to receive one share of common stock on exercise of the warrant, (together the Developer Warrants).

The Developer Warrants were issued for nil consideration and may be exercised at any time between their date of grant and 1 December 2015 (Exercise Period). Developer Warrants not exercised during the Exercise Period will automatically lapse.

Finally, as the issue of the Developer Warrants was within the Company's 15% issue capacity under ASX Listing Rule 7.1, approval for the issue of the Developer Warrants is not being sought from the Company's shareholders.

The securities offered or to be offered have not been registered under the US Securities Act, or any state securities laws, and until so registered, may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the US Securities Act and applicable state securities laws.

This press release is not an offer to sell, nor a solicitation of an offer to buy any securities, nor shall there be any sale of these securities in any state or jurisdiction in which the offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction or an applicable exemption therefrom.

About Unilife Corporation

Unilife Corporation is a U.S.-based medical device company focused on the design, development, manufacture and supply of a proprietary range of retractable syringes. Primary target customers for Unilife products include pharmaceutical manufacturers, suppliers of medical equipment to healthcare facilities and patients who self-administer prescription medication. These patent-protected syringes incorporate automatic, operator-controlled needle retraction features which are fully integrated within the barrel, and are designed to protect those at risk of needlestick injuries and unsafe injection practices. Unilife is ISO 13485-certified and has FDA-registered medical device manufacturing facilities in Pennsylvania.

This press release contains forward-looking statements. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future are forward-looking statements. These forward-looking statements are based on management's beliefs and assumptions and on information currently available to our management. Our management believes that these forward-looking statements are reasonable as and when made. However, you should not place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We do not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results, events and developments to differ materially from our historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those described in "Item 1A. Risk Factors" and elsewhere in our Annual Report on Form 10-K and those described from time to time in other reports which we file with the Securities and Exchange Commission.

General: UNIS-G

SOURCE Unilife Corporation

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