Intraop Medical Announces $3 Million Inventory Financing Agreement

[August 19, 2005]  Intraop Medical Corporation (OTCBB:IOPM) announced today that it has entered into a $3.0 million inventory financing and factoring agreement with E.U.C Holding and E.U. Capital Venture, Inc.

Under the terms of the Agreement, E.U.C. Holding, through E.U. Capital Venture, Inc., will advance Intraop Medical up to $3.0 million on a revolving basis for use in financing inventory to build Mobetrons and to finance sales contracts for shipments of Mobetrons outside of the United States.

In connection with this Agreement, Intraop Medical issued to E.U.C Holding a two-year warrant to purchase 576,924 shares of Intraop Medical common stock at an exercise price of $0.52 per share. Intraop Medical has also agreed to grant piggy-back registration rights for the shares of common stock issuable upon exercise of the warrant for resale under the Securities Act of 1933, as amended.

Dr. Donald A. Goer, Chief Executive Officer of Intraop Medical, commented, “We are very pleased to have secured this financing with E.U. Capital. This financing increases the amount of capital available to us for building and shipping Mobetrons. This is an important element of our financing strategy, and we are delighted to have it in place.”