XFONE Announces Filing of Rights Offering Prospectus

XFONE, Inc.

announced that further to its July 6, 2011 and September 8, 2011 announcements, the Company filed a final prospectus on September 12, 2011 (the “Prospectus”) with the U.S. Securities and Exchange Commission (the “SEC”) for its previously announced rights offering (the “Rights Offering”) in which holders of its common shares as of 5:00 p.m. New York City time (Midnight Israel time) on September 22, 2011 (the “Record Date”) will receive one (1) non-transferable and non-tradable right to purchase one (1) additional share of the Company's common stock, par value $0.001 (“Common Stock”) for each share owned as of the Record Date, for a subscription price of $0.30 per share. The Company's registration statement on Form S-1 (as amended) of which the Prospectus is a part, was declared effective by the SEC on September 12, 2011. The Company is offering an aggregate of up to 21,119,488 shares of its Common Stock pursuant to the Prospectus. The Rights will expire, if not exercised, by 5:00 p.m. New York City time (11:00 p.m. Israel time), on October 26, 2011. Shareholders should consult the Prospectus and their advisors to determine their rights under the Rights Offering. Offering materials fully detailing the terms, subscription documents and important dates of the Rights Offering are expected to be sent on or about September 30, 2011 to shareholders who are entitled to participate at the Rights Offering.