EANS-Adhoc: Oxygen Biotherapeutics Enters into Purchase Agreement to Sell $5 million of Unsecured Promissory Notes to Vatea Fund

ad-hoc disclosure transmitted by euro adhoc with the aim of a Europe-wide distribution. The issuer is solely responsible for the content of this announcement.

13.10.2010

DURHAM, NC, September 13, 2010 - Oxygen Biotherapeutics, Inc. (NASDAQ & SIX Swiss Exchange: OXBT) Dr. Antoine Carlisle entered into a Note Purchase Agreement with JP SPC 1 Vatea, Segregated Portfolio whereby the Company agreed to issue and sell to the Vatea 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 well be available on Form 8-K filed with the Securities and Exchange Commission at www.sec.gov.later today.

end of ad-hoc-announcement ================================================================================ 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 www.oxybiomed.com or www.buydermacyte.com

Caution Regarding Forward-Looking Statements
This news release contains certain forward-looking statements by the company that involve risks and uncertainties and reflect the company's judgment as of the date of this release. These statements include the expansion of research and development of the Oxycyte product line, including Wundecyte, and the timing of the introduction of those new products. The forward-looking statements are subject to a number of risks and uncertainties including matters beyond the company's control that could lead to delays in new product introductions and customer acceptance of these new products, and other risks and uncertainties as described in our filings with the Securities and Exchange Commission, including in the current report on Form 10-Q filed on September 9, 2010. The company disclaims any intent or obligation to update these forward-looking statements beyond the date of this release. This caution is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

end of announcement euro adhoc
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issuer: Oxygen Biotherapeutics Inc. 2530 Meridian Pkwy US-27713 Durham, NC phone: +1(919)7607606 FAX: +1(419)7108764 mail: c.stern@oxybiomed.com WWW: www.oxybiomed.com sector: Biotechnology ISIN: US69207P2092 indexes: SSIRT

stockmarkets: Nasdaq: New York, Main Standard: SIX Swiss Exchange language: English

Rückfragen & Kontakt:

Ellen Corliss

Vice President, Corporate Communications
& Investor Relations
Oxygen Biotherapeutics, Inc
2530 Meridian Pkwy, 3rd floor
Durham, NC 27713
Direct Telephone: +1 919 855 2112
Direct Fax: +1 919 806 4417
Email: e.corliss@oxybiomed.com

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