SOURCE: Cardima, Inc.

September 19, 2007 08:30 ET

Cardima Announces Debt Settlement Agreement

FREMONT, CA--(Marketwire - September 19, 2007) - Cardima, Inc. (OTCBB: CADM), developer of the REVELATION® Tx, REVELATION® T-Flex ablation microcatheters and INTELLITEMP® Energy Management Device, announces today that it has reached a preliminary understanding with its principal creditor, Apix International Limited (the "Lender") regarding a debt settlement. Under the terms of the settlement, the Company will repay all outstanding debt obligations to the Lender, and repurchase all warrants held by the Lender, by issuing to the Lender a total of 88 million shares of the Company at a price of US $0.30 per share in full settlement of the US$26,400,000.00 owed to the Lender. Completion of the transaction is subject to execution of definitive agreements.

Rob Cheney, Chief Executive Officer of Cardima, said, "This transaction shows the confidence of investors in the future of the Company and marks a significant step towards strengthening the Company's financial position by settling the significant debt that had built up over the past two years as a result of the Lender providing financial support for the Company during this critical period."

About Cardima

Cardima, Inc. has developed the PATHFINDER® series of diagnostic catheters, the REVELATION® series ablation catheters, the INTELLITEMP® Energy Management Device, and the Surgical Ablation System (SAS). The REVELATION® series with the INTELLITEMP® energy management device was developed for the treatment of atrial fibrillation (AF) and received CE mark approval in Europe. The PATHFINDER® series diagnostic catheters and the SAS with an INTELLITEMP® received a 510(k) approval in the U.S. by the FDA.

For more information please visit the Company's website at http://www.cardima.com.

Forward-Looking Statements

Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by such forward-looking statements. Potential risks and uncertainties include: the uncertainties associated with the prospects for FDA approval of any new devices; the prospect for any future clinical trials or regulatory activities; the risks associated with the Apix loan facility's restrictive covenants, security interest, fee provisions and other terms and conditions; the risk that the Company will not be able to raise additional capital in the immediate term as needed to continue operations and the risk that we will be unable to secure a strategic transaction involving the Surgical Ablation System. Additional risks and uncertainties are set forth in the Company's Annual Report on Form 10-KSB for the year ended December 31, 2006, the Company's Quarterly Report on Form 10-QSB for the second quarter ended June 30, 2007, and in the Company's subsequent SEC filings. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof, or to reflect the occurrence of unanticipated events or changes in the Company's plans or expectations.

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