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Oxygen Biotherapeutics Enters Into Purchase Agreement to Sell $5 Million of Unsecured Promissory Notes to Vatea Fund

DURHAM, N.C., Oct. 13, 2010 (GLOBE NEWSWIRE) -- Oxygen Biotherapeutics, Inc. (Nasdaq:OXBT) (SIX Swiss Exchange:OXBT) entered into a Note Purchase Agreement with JP SPC 1 Vatea, Segregated Portfolio whereby the Company agreed to issue and sell to the Vatea Fund an aggregate of $5 million of senior unsecured promissory notes in a series of closings between October 31, 2010, and December 31, 2010. Vatea is a party to a securities purchase agreement with the Company, dated June 8, 2009, and subsequently amended. Vatea is the Company's largest shareholder, holding approximately 13.68% of the Company's outstanding common stock. In addition, Gregory Pepin, a director of the Company, is Investment Manager to the Vatea Fund.
/ Source: GlobeNewswire

DURHAM, N.C., Oct. 13, 2010 (GLOBE NEWSWIRE) -- Oxygen Biotherapeutics, Inc. (Nasdaq:OXBT) (SIX Swiss Exchange:OXBT) entered into a Note Purchase Agreement with JP SPC 1 Vatea, Segregated Portfolio whereby the Company agreed to issue and sell to the Vatea Fund an aggregate of $5 million of senior unsecured promissory notes in a series of closings between October 31, 2010, and December 31, 2010. Vatea is a party to a securities purchase agreement with the Company, dated June 8, 2009, and subsequently amended. Vatea is the Company's largest shareholder, holding approximately 13.68% of the Company's outstanding common stock. In addition, Gregory Pepin, a director of the Company, is Investment Manager to the Vatea Fund.

"We are pleased to provide financial resources to Oxygen Biotherapeutics because we believe the Company is well positioned to move its commercial and research programs forward," said Mr. Pepin. "As a long term investor, we thought it was natural to step in and provide the financial support to help the company generate revenue from its DERMACYTE® skin care products and advance its research projects."

"We feel privileged to have the Vatea Fund as a long-term investor. This financing demonstrates their belief in our strategy and represents the catalyst required to enable us to advance on our commercial roadmap," said Chris Stern, Chairman & Chief Executive Officer of Oxygen Biotherapeutics.

Additional information regarding this agreement will be available on Form 8-K filed with the Securities and Exchange Commission at www.sec.gov later today.

About Oxygen Biotherapeutics, Inc.

Oxygen Biotherapeutics, Inc. is developing medical and cosmetic products that efficiently deliver oxygen to tissues in the body. The company has developed a proprietary perfluorocarbon (PFC) therapeutic oxygen carrier and liquid ventilation product called Oxycyte that is being formulated for both intravenous and topical delivery. This year, the company launched its DERMACYTE® line of oxygen-rich skin care products. In addition, the company is focused on perfluorocarbon-based oxygen carriers for use in traumatic brain injury, decompression sickness, personal care, and topical wound healing.

More information is available at or .

The Oxygen Biotherapeutics, Inc. logo is available at

Caution Regarding Forward Looking Statements

Certain statements in this release and other written or oral statements made by or on behalf of the Company are "forward looking statements" within the meaning of the federal securities laws. Statements regarding future events and developments and our future performance, as well as management's expectations, beliefs, plans, estimates or projections relating to the future are forward-looking statements within the meaning of these laws. The forward looking statements are subject to a number of risks and uncertainties including market acceptance of the Company's services and projects and the Company's continued access to capital and other risks and uncertainties. The actual results the Company achieves may differ materially from any forward-looking statements due to such risks and uncertainties. These statements are based on our current expectations and speak only as of the date of such statements, and the Company assumes no obligation to update the information in this release.

CONTACT: Oxygen Biotherapeutics, Inc. Ellen Corliss, Vice President, Corporate Communications & Investor Relations (919) 855-2112