Neah Power Systems, Inc., a Nevada corporation (NPWS.OB) – announces today that on December 27, 2006 and effective today, that it has entered into Bridge Loan Agreements and issued 6% Secured Promissory Notes Due May 26, 2007 to six accredited institutional investors in exchange for gross proceeds of $1,550,000. Early repayment of the Notes can be triggered upon the Company completing debt or equity financing in excess of $2 million. The Notes are secured by a Stock Interest and Pledge Agreement for all the shares of our wholly-owned subsidiary Neah Power Systems, Inc., a Washington corporation, which also executed a Security Interest Agreement granting the buyers of the Notes a security interest in substantially all of its assets including pending and issued patents. In addition, our president Paul Abramowitz and largest stockholder Summit Trading Ltd. pledged an aggregate of 3 million shares of our common stock to further secure the debt. As consideration for the financing described herein, the Company issued the buyers an aggregate of 500,000 shares of NPWS common stock.
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