iParty Corp. Announces an Initial Closing of $9.4 Million in a Private Placement Of Series B Convertible Preferred Stock

Business Wire, August 27, 1999

NEW YORK--(BUSINESS WIRE)--August 27, 1999--

iParty Corp. (OTC BB:IPTY), today announced an initial closing of $9.4 million in a private placement with accredited investors of Series B Convertible Preferred Stock and redeemable common stock purchase warrants. These funds represent an initial closing of a maximum offering amount of $15 million (which may be increased to up to $20 million to cover over-subscription).

"We are excited to have the resources to begin an integrated marketing campaign to raise consumer awareness of iParty.com and to build our site into the premier resource for party goods and party planning," said Sal Perisano, CEO of iParty.

The initial closing is comprised of 468,650 shares of Series B Preferred Stock convertible into 4,686,500 shares of common stock and the issuance of an additional 2,343,250 warrants to purchase shares of common stock at an exercise price of $2.00 per share. The financing also included the conversion of $1,125,000 of iParty's outstanding 10% Senior Convertible Notes.

Headquartered in New York City and located at www.iParty.com, iParty is an Internet-based merchant of party goods, party-related services, personalized celebrity greetings, and party planning advice and information. From children's birthday parties to weddings, from Super Bowl parties to Halloween, iParty uses the Internet to make it easy and convenient for consumers to plan and give parties. iParty is the ultimate resource for party givers to exchange ideas about parties, select themes, make comprehensive plans, and purchase all of the goods and services for a successful event.

Certain information included in this news release (as well as information included in oral statements or other written statements made or to be made by iParty) contains statements that are forward-looking, such as statements relating to anticipated future revenues of the company and the success of current product offerings. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ materially from those expressed in any forward-looking statements made by or on behalf of iParty.