Medis Reports Purchase Agreement for $38 Million Notes

July 24, 2005 by Jeff Shepard

Medis Technologies Ltd. (New York) announced that it has signed a definitive purchase agreement for the offering and sale of $38 million aggregate principal amount of six percent senior convertible notes due 2010, exclusive of an option granted to the initial purchaser to purchase and sell an additional $7 million aggregate principal amount of notes for a 30-day period following the date of the offering memorandum relating to the offering, for a total of up to $45 million aggregate principal amount of notes. The net proceeds will be used for the construction, startup, and other costs related to a fully automated manufacturing line for the company' fuel cell products, as well as for working capital and general corporate purposes.

The offering constitutes a private placement under Rule 144A of the Securities Act of 1933 only to qualified institutional buyers. The securities will not be registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.