Megola Inc. Converts $1,378,850 of Debt Into Preferred Series B Convertible Stock

POINT EDWARD, ON, Jul 13 (MARKET WIRE) --
Megola Inc. (PINKSHEETS: MGOA) announced today that the Company has
converted USD$1,378,850 of debt into equity by issuing its Convertible
Preferred Series 'B' Shares at $10.00 per unit. The Series 'B' Preferred
Shares have no warrants and do not have any voting rights. In total,
Megola has issued $1,378,850 in Series 'B' Preferred Shares at $10.00 per
share or 137,885 Series 'B' Preferred Shares.

Purpose of the Exchange Offer

The purpose of this exchange offer was to replace the company's long-term
debt with long-term equity investment in Megola through the Series B
Convertible Preferred Stock. The exchange offer that was made was part of
a plan to improve the company's overall capital structure.

"The unanimous acceptance of this offer by our creditors is a clear
indication that they have confidence in Megola over the next 12 month
period. This greatly improves our balance sheet, which will help us with
future funding requirements, should they be required. We felt it was
prudent to issue a special series of our Preferred Shares with a stated
value of $10.00 per share rather than issue common shares at today's
current price levels that would have diluted our common stock," stated
Joel Gardner, President and CEO of Megola, Inc.

For more detailed information about the Company please visit Megola's
website at http://www.megola.com

The matters set forth in this press release are forward-looking statements
within the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking statements
are subject to risks and uncertainties that may cause actual results to
differ materially. These risks are detailed from time to time in the
company's periodic reports filed with the Securities and Exchange
Commission including the company's Annual Report, Quarterly Reports and
other periodic filings. These forward-looking statements speak only as of
the date hereof. The company disclaims any intent or obligation to update
these forward-looking statements.

Contact:

Darryl Germain
COO
Megola Inc.
1 888 558 6389 x 26 (M-F 9am-4pm EDT)
1 519 336 0628 x 26 (M-F 9am-4pm EDT)
dgermain@megola.com

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