March 21, 2010 (FinancialWire) — NexMed, Inc. (NASDAQ: NEXM) said that it raised $1.4 million in gross proceeds from refinancing the mortgage on its manufacturing facility in New Jersey.

According to the company, the mortgage secures the issuance of new convertible notes due December 31, 2012, which were purchased by three accredited investors, including The Tail Wind Fund Ltd., of Great Britain, a long-time investor in NexMed.

The notes, which total $4 million, are convertible into shares of NexMed common stock at $0.58 per share on or before the due date. The notes have a coupon rate of 7% per annum which is payable at NexMed's option, in cash or with certain exceptions, in shares of NexMed common stock at a price of 95% of a five-day weighted average of the market price of its common stock prior to the time of payment.

NexMed said it has used the proceeds to pay off in full the existing $2.59 million mortgage that was due December 31, 2011 and has earmarked the balance for working capital and general corporate purposes.

The company said its facility in New Jersey is currently leased to a long term tenant who also has an option to purchase the building for $4.4 million. The annual rental income from the lease exceeds the annual debt service on the new mortgage, according to the company.

California-based NexMed is a specialty CRO with a focus on in vitro and in vivo pharmacology services and research models.

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