VoIP, Inc. Enters Into $2.5 Million Private Placement

VoIP, Inc. (OTCBB: VOIC) announced today that it has entered into definitive agreements for a private placement comprised of secured convertible notes (“Notes”) issued to a number of institutional investors, including existing shareholders. The Company agreed to issue Notes carrying a face value of $2,871,601, resulting in net proceeds to the Company of $2,497,044. Proceeds will be used to repay outstanding promissory notes and other obligations to investors, and to support working capital requirements created by the Company’s growth. VoIP received approximately $1.3 million in the first closing and is expected to receive the remaining proceeds under closings scheduled for January 18, 2008 and February 18, 2008.

“We are pleased that the existing investor group recognized the significant progress we have made over the past year, and elected to provide additional capital to support our growth,” said Tony Cataldo, VoIP, Inc.’s Chief Executive Officer. “During the past year, we have expanded our network, increasing the minutes carried over it substantially. This has resulted in improved operating results, a trend we expect will continue throughout 2008. This financing will allow us to support higher levels of activity over our network and to continue to invest in maintaining and expanding it.”

The Notes mature on June 18, 2008. The investors will also be issued 16,382,352 shares of series A preferred stock (the “Preferred Stock”) with a stated value of $0.50 per share. The investors may at their election convert all or part of the Notes and Preferred Stock into shares of the Company’s common stock at the conversion rate of the lesser of $0.072 per share or 70% of the Company’s average of the three lowest closing bid prices of its common stock for the 10 days prior to the date an investor converts its Note or Preferred Stock. The shares underlying the Preferred Stock and Notes have not been registered.

About VoIP, Inc.

VoIP, Inc. is a leading provider of turnkey Voice over Internet Protocol (VoIP) communications solutions for service providers, resellers and consumers worldwide. The Company is also a certified Competitive Local Exchange Carrier (CLEC) and Inter Exchange Carrier (IXC). Through its wholly owned subsidiary, VoiceOne Communications, LLC, the Company provides a comprehensive portfolio of advanced telecommunications technologies, enhanced services, broadband products, and fulfillment services to the VoIP and related communications industries. Current and targeted customers include IXCs, CLECs, Internet Telephony and Conventional Telephony Service Providers (ISPs and ITSPs), cable operators and other VoIP Service Providers in the United States and countries around the world. The Company enables these customers to expand their product/service offerings by VoIP’s nationwide packet network through services such as voice termination/origination, e911 emergency call service for VoIP, CALEA, Broadband Voice, IP Centrex and other advanced communications services and technologies. For information on VoIP, Inc. please visit the Company’s web site: http://www.voipincorporated.com .

Safe Harbor Statements about the Company’s future expectations and all other statements in this press release other than historical facts, are ‘forward-looking statements’ within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and as that term is defined in the Private Securities Litigation Reform Act of 1995. The Company intends that such forward-looking statements be subject to the safe harbors created thereby. The above information contains information relating to the Company that is based on the beliefs of the Company and/or its management as well as assumptions made by and information currently available to the Company or its management. When used in this document, the words ‘anticipate,’ ‘estimate,’ ‘expect,’ ‘intend,’ ‘plans,’ ‘projects,’ and similar expressions, as they relate to the Company or its management, are intended to identify forward-looking statements. Such statements reflect the current view of the Company regarding future events and are subject to certain risks, uncertainties and assumptions, including the risks and uncertainties noted. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove to be incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected, intended or projected. In each instance, forward-looking information should be considered in light of the accompanying meaningful cautionary statements herein. Factors that could cause results to differ include, but are not limited to, successful performance of internal plans, the impact of competitive services and pricing and general economic risks and uncertainties.