CHIP Verichip (MM)

VeriChip Corporation (�VeriChip� or the �Company�) (NASDAQ:CHIP), a provider of radio frequency identification (RFID) systems for healthcare and patient-related needs, announced today it has entered into an $8 million debt financing with Valens Offshore II, Corp. (�Valens�). The financing is a thirteen-month, non-convertible term loan bearing interest at an annual rate equal to 12%. In consideration of the financing, VeriChip issued to Valens 120,000 shares of the Company's common stock. The Company will use $5.3 million of the proceeds from this financing to prepay debt owed to Digital Angel (NASDAQ:DIGA). As a result of this prepayment, the Company will not be obligated to make any further debt service payments to Digital Angel until September 2009. By eliminating all 2008 debt service payments, the financing will result in an increase of more than $3.6 million to working capital for the Company in 2008. Scott R. Silverman, Chairman and Chief Executive Officer of VeriChip, said, �This new financing not only enables us to eliminate more than $5 million in debt owed to Digital Angel, but also provides us sufficient working capital to fund our business plan, which includes a new consumer marketing initiative, through early 2009.� About VeriChip Corporation VeriChip Corporation, headquartered in Delray Beach, Florida, develops, markets and sells RFID systems used to identify, locate and protect people and assets. VeriChip's goal is to become the leading provider of RFID systems for people in the healthcare industry. The Company recently began marketing its VeriMed� Patient Identification System for rapidly and accurately identifying people who arrive in an emergency room and are unable to communicate. This system uses the first human-implantable passive RFID microchip, the implantable VeriChip�, cleared for medical use in October 2004 by the United States Food and Drug Administration. For more information on VeriChip, please call 1-800-970-2447, or email info@verichipcorp.com. Additional information can be found online at www.verichipcorp.com. This press release contains certain �forward-looking� statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Forward-looking statements included in this press release include, without limitation, those concerning expectations for the Company�s ability to fund its business plan. These forward-looking statements are based on the Company�s current expectations and beliefs and are subject to a number of risks, uncertainties and assumptions. Among the important factors that could actual results to differ materially from those expressed in, or implied by, the forward-looking statements are our ability to successfully implement our business strategy; our expectation that we will incur losses, on a consolidated basis, for the foreseeable future; the relative maturity in the United States and limited size of the markets for our infant protection and wander prevention systems and vibration monitoring instruments; the degree of success we have in leveraging our brand reputation, reseller network and end use customer base for our infant protection and wander prevention systems to gain inroads in the emerging market for asset/staff location and identification systems; the rate and extent of the U.S. healthcare industry�s adoption of RFID asset/staff location and identification systems; the relative degree of market acceptance of our zonal, or cell ID, active RFID systems compared to competing technologies, such as lower power Ultra Wide Band-based location technologies; uncertainty as to whether we will be able to increase our sales of infant protection and wander prevention systems outside of North America; our reliance on third-party dealers to successfully market and sell our products; uncertainty as to whether a market for our VeriMed system will develop and whether we will be able to generate more than a nominal level of revenue from the sale of these systems; and market acceptance of our VeriMed system, which will depend in large part on the future availability of insurance reimbursement for the VeriMed system microchip implant procedure from government and private insurers, and the timing of such reimbursement, if it, in fact, occurs. Additional information about these and other factors that could affect the Company�s business is set forth in the Company�s various filings with the Securities and Exchange Commission, including those set forth in the Company�s 10-K filed on April�2, 2007, under the caption �Risk Factors.� The Company undertakes no obligation to update or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this statement or to reflect the occurrence of unanticipated events, except as required by law.